Right now, marijuana is a highly politicized industry, one heavily regulated by many governments, including the federal government of the United States. Over the next decade this will dramatically change. We're seeing a tidal shift in marijuana regulations at the state level. States are decriminalizing marijuana, legalizing "medical marijuana," and in some cases are legalizing recreational marijuana.
This shift in criminal law at the state level is causing a disconnect between federal law and state law. Ultimately, the federal government will have to shift its laws to match criminal laws in the states. Meanwhile, however, federal regulations are causing bottlenecks in the marijuana industry. For instance, banks are not allowed to loan marijuana companies money under federal law. Many of these pot start-ups are starved for cash.
Innovative Industrial Properties (NYSE: IIPR) is addressing this pain point by is financing much of the marijuana industry in the United States. And by doing so, the company has now become the largest owner of marijuana acreage in the U.S. This dynamic will make IIP the strongest pot stock over the next 10 years.