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The hemp and CBD industry entered full panic mode last month. A restrictive provision slipped into the government spending bill threatened to wipe out an estimated 95% of the hemp market overnight. Now, Trump's executive order is signaling a course correction, and potentially paving the way for hemp CBD banking reform that could reshape the entire industry.
During a recent Qredible Live Broadcast, Brian Fitzpatrick, CEO of Qredible, addressed the anxiety head-on while providing clarity on what operators can realistically expect for hemp, CBD, and cannabis banking in 2025 and 2026. His analysis covered the hemp crisis, the SAFER Banking Act's prospects, and why credit cards still won't work for cannabis even after rescheduling.
"It is going to impact the industry. There's no question about it," Fitzpatrick acknowledged. But he also outlined a path forward that offers genuine hope for operators willing to adapt.
The 2018 Farm Bill, championed by Senator Mitch McConnell and signed by Trump, legalized hemp and created what has grown into a $28 billion industry. However, unintended consequences emerged as the market expanded beyond traditional CBD products into intoxicating synthetic and semi-synthetic cannabinoids.
"The hemp industry grew to 28 billion which included these intoxicating products," Fitzpatrick explained. "It's the alphabet soup of semi-synthetic and synthetic products. Delta 8, Delta 10, Delta 11, HHC, THC-O, THC-P."
These products were mass-marketed using the 2018 Farm Bill as legal cover, prompting backlash from federal and state lawmakers who argued this was never Congress's intent.
Last month, Senators Mitch McConnell and Congressman Andy Harris authored prohibitive language that was included in the government appropriations bill during the shutdown crisis. The provision limited hemp products to 0.4 milligrams of THC per container.
"That would effectively ban about 95% plus of the hemp industry including these other good CBD products and everything else," Fitzpatrick said. "It would essentially have decimated the entire industry."
Senator Rand Paul threatened to hold up the entire spending bill over the provision, arguing it would destroy the hemp industry. However, with the government shut down, most Republicans prioritized reopening operations over debating hemp policy.
"I can just imagine Trump sitting there going, 'Hey guys, we're not going to sit here and debate hemp and CBD for the next 6 weeks while the government's shut down in a 45-day government shutdown. We have bigger fish to fry. We'll fix that problem later," Fitzpatrick surmised.
The executive order now directs the White House to work with Congress to update the statutory definition of hemp-derived cannabinoid products. The goal, according to Fitzpatrick, is to "allow Americans to benefit from access to appropriate full-spectrum CBD products" while "preserving Congress's intent to restrict the sale of products that pose serious health risks."
The order also directs the Department of Health and Human Services to develop research methods and improve access to hemp-derived CBD products.
"Trump's position is he supports full-spectrum CBD access for patients. He wants Congress to fix this problem that was basically created in this last month bill," Fitzpatrick explained. "That's a clear signal that he's saying McConnell and Harris restrictions went way too far."
The 0.4 milligram restriction is scheduled to take effect in November 2026. Trump has directed this to be fixed before then, with efforts underway to address it by April, given the midterm election year timeline.
Fitzpatrick outlined his expectations for the hemp industry's future: "We do expect to see a smaller but more regulated and more clearly wellness, medical, and wellness-oriented hemp and CBD industry."
For hemp beverages specifically, he believes low-dose delta-9 products will survive. "The industry pretty much today is already in this two to five milligram per can type of thing," he noted. "If Congress adjusts the cap to something rational, the most likely survivor there is going to be the low-dose delta-9 drink."
High-dose and synthetic products will likely either move behind dispensary counters or disappear entirely, with new requirements for age-gating, labeling, and testing at retail.
One of the most common misconceptions is that Schedule 3 rescheduling will open the doors for Visa and Mastercard to process cannabis transactions. Fitzpatrick was direct: "Will credit card companies all of a sudden rush in now that it's Schedule 3? No."
The reason is straightforward: cannabis remains federally illegal even as a Schedule 3 substance. It still violates the Controlled Substances Act, and card networks prohibit illegal transactions.
"Visa prohibits the purchase of products that claim or imply a similar efficacy as prescription drugs, controlled substances, or recreational street drugs. Irrespective to claims of legality," Fitzpatrick quoted. "That's the critical phrase. Irrespective to claims of legality."
Mastercard's position is identical: marijuana purchases are not allowed on its network because the drug remains illegal under federal law.
Cannabis businesses currently rely on cash, cashless ATMs (which are actually point-of-banking withdrawals), and in some cases gray market credit card processing that miscodes transactions as apparel or other purchases.
"These workarounds, they're just not sustainable and they're failing," Fitzpatrick warned. "They can lead to payment processors regularly shutting down cannabis accounts, hidden fees, and really there's no true credit card acceptance."
Hemp CBD banking reform hinges on the SAFER Banking Act, which would protect financial institutions from federal penalties for serving the cannabis industry.
"What I really believe is going to happen here is first of all, Schedule 3 alone is not going to bring credit cards and banking magically into the equation. Safer banking is the critical piece," Fitzpatrick stated.
The SAFER Banking Act would provide a safe harbor for banks, credit unions, and payment processors entering the cannabis space. This could potentially allow Visa, Mastercard, and American Express to open their networks to the industry.
The House has passed versions of SAFER Banking seven times over past sessions. The Senate Banking Committee approved it on September 27, 2023, clearing it for a floor vote. However, then-Senate Majority Leader Chuck Schumer never brought it to the floor due to competing priorities.
Fitzpatrick highlighted recent testimony from Tyler Lindholm of Leafstreet Strategies before the Senate Banking Committee: "No discussion of the issue is complete without addressing the challenges facing the cannabis industry and the role policy solutions like the Safer Banking Act can play. 40 states with regulated cannabis markets but businesses continue to struggle to access basic financial services."
Key senators on the committee expressed support. Senator Katherine Cortez Masto, Democrat from Nevada, called passing SAFER Banking one of her top legislative priorities. Senator Bernie Moreno, Republican from Ohio, is expected to sponsor the bill in the Senate.
Trump himself stated during his 2024 campaign that he would work with Congress to pass a safe banking bill.
"There's a lot of belief and consensus that we're going to see this happening in 2026. Very important year," Fitzpatrick noted.
If SAFER Banking becomes law, traditional banks can enter the market without fear of federal penalties. Visa, Mastercard, and American Express are likely, though not guaranteed, to open their networks. Electronic payments would become standard for dispensaries, lending products would become available, and cash-heavy operations would decrease, improving public safety and lowering costs for cannabis businesses.
Fitzpatrick highlighted several legislators working on solutions for hemp CBD banking reform and broader cannabis policy. Senator Ron Wyden of Oregon and Congressman Morgan Griffith of Virginia have developed comprehensive proposals that Qredible has discussed with their offices.
"This isn't just stuff they just pulled out recently. They've been working on this for months and months and months," Fitzpatrick said. "They have some great ideas."
The message for hemp, CBD, and cannabis operators is clear: significant regulatory changes are coming, and preparation is essential. Compliance, quality, and safety standards will tighten as the industry matures.
"That's why Qredible exists," noted Faith, co-host of the broadcast. "The sooner businesses who are serious about enduring and surviving this volatility can get compliant and learn to follow the rules, the longer they'll last."
Fitzpatrick reinforced the opportunity: "We're going to be there for Visa, Mastercard, American Express, and their banks and their ISOs underneath of that to help get this right and be able to do product-level validation and verification electronically."
For the complete analysis of Trump's cannabis policy shift, including detailed breakdowns of 280E tax relief, the Big Pharma narrative, and research expansion opportunities, watch the full Qredible Live Broadcast with Brian Fitzpatrick.
