Story Highlights

  • A severe lung disease linked to black-market vaping products is sweeping the nation.
  • A third of legal cannabis users vape, so the marijuana sector is selling off on the news.
  • Lawmakers could make one move that will be a huge win for legal cannabis.

A vaping crisis is sweeping America. Hundreds are falling ill. And that’s having a serious impact on the cannabis sector.

Today we’ll cover what vaping is, what we know about this health crisis and the effect it has on the cannabis market.

Watch my latest Marijuana Markets: A POTcast for more information on the vaping crisis and the results of the SAFE Banking Act.

Vaping is short for vaporizing. Users insert a cartridge filled with liquid into their electronic cigarettes, or “vapes.” The vape uses a heating element to turn the mixture of food-grade liquids into to gas or vapor.

Nicotine, THC or CBD — two major cannabis components — mix with these liquids to produce the desired effect.

Problems arise from contaminants in either the heating element or the liquid. Early heating coils from China appeared to contain lead and other contaminants.

While concerning, it was easy enough to test these coils for toxic metals. That muted the concern over legal vapes.

The liquids in vaping products — whether nicotine, THC or CBD — are a different story.

The Real Concern Behind Vaping

These liquids include two food-grade chemicals: propylene glycol and vegetable glycerin.

These ingredients are safe for food, but they aren’t safe to inhale. Researchers are still investigating the effects of vaping these chemicals.

But there is a third chemical that is gaining popularity in black-market vapes: vitamin E acetate.

U.S. health officials are investigating more than 450 potential cases and eight deaths linked to the severe respiratory illness. Right now, it looks as though most of the cases link back to black-market cannabis vapes.

To be clear, vitamin E acetate itself isn’t harmful. It occurs naturally in corn and other vegetable oils, and it’s a dietary need for our bodies.

That’s why we find it as a dietary supplement in foods.

The issue comes when it’s added to vaping pens. In black-market products, it thickens the liquid in the cartridge of vape pens. But the effects of vaping this chemical additive appear to be deadly.

Legal cannabis products don’t include this dangerous chemical. Unfortunately, lawmakers are tackling the situation all wrong.

Massachusetts banned all vaping products. It seems California is making a similar move. The state called for residents to stop vaping.

These bans are going to make the problem worse.

With legal and regulated outlets closed, people will turn to the black market — the very place that introduced vitamin E acetate.

Black-market products use it in a dangerous way to boost margins. It also helps to increase sales because the products are cheaper.

Black-Market Products Cause a Sell-Off in the Cannabis Sector

The sell-off in the cannabis sector is because the media hasn’t clarified which vaping products cause lung disease.

About a third of legal cannabis use in the U.S. comes from vaping. Investors are concerned that the ban on legal cannabis products is hurting sales.

But if there’s a silver lining in this health crisis, it’s that it offers an opportunity.

If lawmakers can embrace stricter regulations on vaping products, the public will shift from the black market to the legal market.

That would be a huge win for legal cannabis!

I’m monitoring the vaping crisis. The sell-off could prove to be a great buying opportunity for edgy investors like us.

And I’m listening closely to comments from lawmakers and health officials. Stay tuned for any updates on this matter.

Now it’s your turn. I’d like to hear from you.

What is your experience with vaping?

Do you think lawmakers should have a say in what vaping products Americans buy?

Do you plan to take advantage of this sell-off?

Write to me at I’ll make sure to address any concerns you have, and you may even see your email featured in our Saturday newsletter.

Good investing,

Anthony Planas

Internal Analyst, Banyan Hill Publishing

P.S. To stay up to speed on the latest marijuana market news, hit the subscribe button on my YouTube channel.