The regulatory future of cannabis in the United States remains a complex puzzle. As the Trump administration navigates the Controlled Substances Act, traders are turning to Kalshi’s "Will marijuana be rescheduled?" market to measure the likelihood of federal reform.
This prediction market acts as a critical barometer for the evolving political landscape. By quantifying expectations, it filters out political noise and helps isolate what the market truly expects regarding the timeline for federal policy shifts.
While the Department of Justice's April 23 announcement to reclassify state-licensed medical marijuana was an important move and triggered a significant response in market pricing, traders are now recalibrating their forecasts as they weigh the difference between limited medical reclassification and a broader, systemic change to the plant's status.
Market Rules
The payout criterion for this contract dictates that for a "Yes" resolution, marijuana — formally defined as cannabis or "marihuana" under the Controlled Substances Act — must be removed from Schedule I and placed into a lower schedule.
It is important to note that if the Drug Enforcement Administration (DEA) decides to reschedule only specific cannabis derivatives or individual cannabinoids, such as moving THC or a particular pharmaceutical to a different schedule without reclassifying the marijuana plant in its entirety, this does not satisfy the requirements of the contract.
Also, the mere announcement or publication of a Final Rule in the Federal Register is insufficient for a positive resolution; the rule must have actually taken legal effect, as the market resolves strictly based on the real-world status of the Schedules under the Controlled Substances Act.
Short-Term Optimism Wanes as Implementation Nears
The landscape for short-term rescheduling contracts — specifically those expecting action before July 2026 — has undergone a significant correction. Throughout the summer of 2025, these contracts traded near 80 cents. This high confidence was largely driven by the administration’s rhetoric; in August 2025, officials suggested a rescheduling decision would arrive "in weeks."
Additionally, the September 2025 Senate confirmation hearings for "drug czar" Sara A. Carter, where she pledged to "explore all options" regarding rescheduling, helped maintain bullish sentiment.
However, the reality of the administrative process has tempered this outlook. As of late April 2026, the contract is now trading at 46 cents.
The market has reacted to the specific limitations of the April 23 announcement, in which Acting U.S. Attorney General Todd Blanche reclassified only state-licensed medical cannabis products to Schedule III.
Because this move fell short of full plant rescheduling, traders have cooled on the prospect of a complete overhaul happening before the middle of 2026.
Furthermore, with the DEA announcing that public hearings will occur in June 2026, the timeline for a comprehensive federal change has been extended, forcing a re-evaluation of short-term forecasts.
Long-Term Outlook Solidifies Following Executive Action
While short-term confidence has dipped, the outlook for contracts expiring in 2028 and early 2029 — the final days of the current administration — has trended upward since December 2025.
This divergence is rooted in the strategic weight of Executive Order 14370 . Signed on December 18 last year, the order directed former Attorney General Pam Bondi to take "all necessary steps" to carry out rescheduling in an "expeditious manner."
Despite the administration's stated goals, including working with Congress to improve access to full-spectrum CBD and utilizing real-world research models, the path forward is not without resistance.
The market is pricing in the high probability of litigation; industry watchdogs have already noted that legal challenges are essentially guaranteed.
Traders are positioning for a long-haul process where, even if the administration pushes for an "expeditious" timeline, the inevitable court battles are expected to push the effective date of full rescheduling into the latter years of the term.
