US reclassifies some marijuana products to Schedule III

The US Department of Justice has reclassified certain marijuana products from Schedule I to Schedule III, but the Polymarket contract on whether marijuana will be fully rescheduled by December 31 has dropped to 43.9% YES, down from 62% just 24 hours ago.

## Market reaction

The December 31 market now sits at 43.9% YES, a sharp drop from 62% yesterday. Traders are clearly skeptical about further federal action within this timeframe. The June 30 market also fell to 11.5% YES, showing little expectation of change before mid-year.

Trading volume on the December 31 market is $46,442 in daily USDC trading, with enough thinness that $775 can move the price 5 points. The June 30 market is even thinner, where a $1,526 order can cause dramatic swings.

## Why it matters

The reclassification shifts policy but doesn’t legalize marijuana federally. The action fits with President Trump’s push to ease restrictions and could open the door to more research and industry activity. But without federal legalization, traders are pricing in slow progress. At 44¢, a YES share for December 31 pays 2.27x if correct, reflecting a market view that significant regulatory hurdles remain before broader rescheduling.

## What to watch

DEA announcements on final rule publications or expedited hearings will be the next catalysts. Any court actions blocking or delaying rescheduling efforts would also move these markets sharply.

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