How to Invest in Psychedelics


Ryan Allway

February 3rd, 2020

Policy


Denver was one of the first cities in the country to legalize adult-use cannabis and its move to decriminalize psychedelics could open the door to an entirely new market. Like marijuana, advocates for magic mushrooms have had to overcome both stereotypes and excessive regulation to bring attention to its potentially significant medical benefits.

Some studies have found that psilocybin might help dramatically reduce the symptoms of depression and other mental health disorders, while others suggest that it could help with overcome nicotine and alcohol addictions. In fact, the effects from a single treatment session could last months or years, eliminating the need for pharmaceuticals.

State of Legalization

Psilocybin is a Schedule I Controlled Substance on a federal level, but it has been decriminalized in Denver, Colorado, Oakland, California and Santa Cruz, California. Oregon is also moving to decriminalize the substance on a state level, which could open the door to the first state-wide legal market, as well as more widespread therapeutic usage.

On a global level, psilocybin is a Schedule I drug under the United Nations 1971 Convention on Psychotropic Substances, although it has been shown to have numerous medicinal and religious uses, as well as significantly lower potential for abuse than other Schedule I drugs. The mushrooms are also unregulated by UN treaties.

Some countries have already legalized the mushrooms, including the Bahamas, Brazil, The Netherlands (as truffle), and Samoa. Other countries have no laws on the books or ambiguous laws that aren’t very clear about the legal status, including most of Asia (with the exception of Japan) and all of Africa. These dynamics could lead to a large international market.

Investing in Psychedelics

Psychedelics remain illegal on a federal level, but unlike cannabis, it also remains illegal on a state level. While there have been efforts to decriminalize psilocybin, these efforts are in the early states at the state level and have only gained ground in a handful of cities thus far. This makes the market very early-stage for investors.

There are also few public companies operating in the space given the early-stage nature of the market:

  • The Yield Growth Corp. (CSE: BOSS) is a Canadian wellness company that’s focused on cannabis and hemp products. Recently, the company acquired a portfolio of mushroom formulas and launched a new subsidiary, Flourish Mushroom Labs, which plans to expand into the psilocybin business.

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  • Roadman Investments Corp. (TSX-V: LITT) is a Canadian venture capital firm that recently invested in Champignon Brands, a British Columbia-based craft mushroom distributor with plans to expand into the psychedelic mushroom space.

 

  • Wuhan General Group (OTC: WUHN) is a Chinese alternative medicine company with interest in CBD and psilocybin, although both substances have an unclear legal standing in China, where the company is based.

Looking Ahead

Investors interested in investing in psychadelics have few options at the moment, but the growing legalization movement could prompt more companies to enter the space. Given the potential therapeutic value and existing international markets, investors may want to keep a close eye on the space over the coming months and years.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

Ryan Allway

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.


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