By Jason Leisey, Emerald Tea Supply Co.
I traded macro derivatives before building a licensed cannabis dispensary in Bloomfield, New Jersey—I know regulatory arbitrage. The hemp loophole creates a two-tier market where one side bears all cost and the other captures all margin. Hemp farmer John Grady recently published an op-ed defending that arrangement. I am pro-regulation of THC regardless of which plant it came from.
Hemp and cannabis are the same species—Cannabis sativa L. The 2018 Farm Bill defined “hemp” as cannabis with 0.3 percent or less Delta-9 THC by dry weight; anything above is legally “marijuana”—the same molecule assigned to two different regulatory universes based on a number.
A hemp-derived delta-9 THC gummy and a dispensary-sold one produce similar effects. Grady’s “Hemporium” model asks consumers to trust the unregulated version as much as one subject to mandatory third-party testing, seed-to-sale tracking, and state-certified lab verification for heavy metals, pesticides, and residual solvents. That is market positioning, not consumer protection.
Because cannabis remains federally scheduled, licensed dispensaries are subject to IRS Section 280E, which bars deducting ordinary business expenses—rent, payroll, utilities. Cannabis operators routinely face effective federal tax rates of 70 percent or higher on gross profit. Hemp retailers selling chemically identical products file as ordinary retail. Add state excise taxes, licensing fees, compliance overhead, and mandatory security costs, and the gap is structural.
Grady cites Steve DeAngelo and the One Plant Alliance approvingly, then argues for two separate regulatory tracks based on which side of an arbitrary federal definition a product falls on—precisely the opposite of what the Alliance advocates: age verification, testing, and labeling applied equally across every sector.
I support federal legislation creating a unified standard for all intoxicating cannabinoid products: a per-serving THC limit, mandatory age-gating, and third-party testing enforced equally whether a product comes from a hemp farm in Missouri or a licensed cultivator in New Jersey.
“If the loophole persists, that trust erodes. Not because the hemp farmers are bad people. But because a system that applies rigorous standards to one channel and none to another will eventually produce a failure that damages everyone.”
Jason Leisey is a combat veteran of the Iraq War, Columbia MBA, and CEO of Emerald Tea Supply Co., a licensed cannabis dispensary and delivery operation in Bloomfield, New Jersey.