I recently conducted a Q&A with Jordan Tritt, CEO and co-founder of The Panther Group, a cannabis investment group and business advisory firm. Jordan [pictured] is a 10-year cannabis investing veteran.

I edited our discussion for the sake of concision. My questions are in bold.

What are the odds of the U.S. federal ban getting lifted next year?

The current move in Washington is to reschedule marijuana from Schedule I to Schedule III, and I think that’s the best we are going to get for a while.

Before we see federal legalization, the federal government will probably want to scrutinize a lot more data and research. Besides, it takes time to set up the rules and regulations for a nationwide program.

Marijuana equities have rebounded in 2024. What’s driving the rally in pot stocks?

Investors recognize the cannabis industry is here to stay and the worst is likely behind the industry.

With federal rescheduling moving toward a conclusion, there is increased support for medical cannabis across the political spectrum.

The cannabis reform movement has bipartisan support and a Democratic ticket that supports cannabis legalization. There has never been this much visible support across the country.

Does the marijuana equity rally have momentum to extend into 2025?

The industry’s current momentum will likely carry into 2025. The fundamentals of the leading companies will continue to get stronger due to the removal of 280E tax restrictions, the availability of lower-cost capital, and other positive catalysts associated with rescheduling.

Section 280E disallows all deductions or credits for any amount paid or incurred in carrying on any trade or business that consists of illegally trafficking in a Schedule I or II controlled substance. A reschedule to Schedule III would remove this burden from cannabis businesses.

What’s more, we will see growing companies start to access the public markets once there is a signal from the exchanges they are more comfortable with marijuana and greater institutional investor sentiment emerges.

Initiatives to legalize marijuana are on several state ballots in November. How do you think these measures will fare?

Florida is the most intriguing, due to its size and success thus far as a medical cannabis market and the political efforts on both sides of the ballot initiative.

In general, the trend of more states legalizing has gotten so substantive that it has now influenced former President Trump to shift his attitude towards medical cannabis in favor of looser restrictions, given marijuana’s pervasiveness throughout the entire country.

Meanwhile, Democratic candidate Kamala Harris has come out in favor of marijuana legalization.

Explain why economic trends and monetary policy are favorable for cannabis-oriented real estate investment trusts (REITs).

Due to the limited capital available in cannabis, the interest rates (i.e. yield) relative to other industries provide a premium to investors or lenders.

Due to the overall financial strength and relatively consistent financial performance of many of the larger cannabis operators, cannabis-oriented REITs are delivering consistent and solid returns.

Real estate is a familiar asset class and investment strategy, so it’s garnering resilient investor interest, resulting in a self-fulfilling ecosystem. The Federal Reserve is likely to cut interest rates at its next policy meeting in September, and that’s a tailwind.

What are the economic advantages of multi-state operators (MSOs) of dispensaries?

Scale and efficiency are going to rule the day in the marijuana industry, along with sound business principles and well-capitalized organizations. The MSOs that can bring this all together will be the winners in the short and medium term.

Many historical MSOs are burdened with a lot of debt that may be challenging to overcome, so we’ll likely see new MSOs emerge as a combination of complementary smaller, regional MSOs and single-state operators that can compete and thrive in at least 10 markets.

What are the salient global trends in terms of marijuana legalization?

An increasing number of countries are legalizing marijuana. Germany is a particularly interesting example.

Germany recently legalized marijuana and the country has become a popular pick for international expansion, but I also see it being a death trap for many companies. There’s likely to be an overemphasis on Germany with too many operators entering it, as we’ve seen in California or other unlimited license states.

Being able to export into Germany but have a domicile elsewhere where you can secure a local market is a better strategy.

Thanks for your time.

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This article previously appeared on Investing Daily.