_On February 19, 2025, Tennessee Homegrown, a company that makes CBD and hemp-derived THC products, sent out an emergency email blast. “We need YOU! Call to Action” the subject line read, bookended by the flashing siren emoji. The message continued in the same urgent tone: “There are a few bills sent to the house. One will outlaw about 30% of our products. The other bill will put Tennessee homegrown out of business for good. I’m not trying to be Chicken Little but guys, ‘the sky IS falling!!’”

The second one of the bills that prompted Tennessee Homegrown’s emergency email would put hemp-derived THC products such as delta-8 THC under the aegis of Tennessee’s Alcoholic Beverage Commission (ABC). This is only the latest in a long series of attempts to respond to what is seen as a “wild west” of non- or irregularly regulated hemp-based cannabis products—essentially weed sold in gas stations, grocery stores, vape shops, and liquor stores. Because hemp-based THC is federally legal but not regulated by the Food and Drug Administration (FDA), it is hard to know exactly what you are getting, and most everyone agrees some regulations are needed on the state level to protect consumers from shady practices and bad chemistry.

“Making hemp-derived cannabinoids is much like doing moonshine,” says Harold Jarboe, known as the Old Hemp Farmer. He is a partner in Tennessee Homegrown, which he helped found a decade ago, before the wild new world of delta-8 and its chemical cousins took over the South. “You can have a person who can give you a world-class spirit, who’s been doing it for years, takes pride in how they do it. And if you put it down with any other spirit, you couldn’t tell the difference. On the flip side, you have moonshiners that are running stuff through car radiators.”

Jarboe looks like he could be an old-school moonshiner, with a trim white beard, thinning white hair he often covers with a hat, two hoop earrings, and eyes that, like those of many other farmers, have spent too much time squinting at the sun during the day and at their thin margins at night. And while he might like some regulation, he has the suspicious mind of an old moonshiner, too, and sees the proposed bill as a giveaway to Big Booze, which has already made inroads into the industry. “The biggest distributors of THC drinks are the major liquor distributors—Lipman, Empire, Best Brands—and they’ve got into it big because they supply most of the [hemp-derived THC] drinks in Tennessee.”

Because of the way powerful interests are aligned, Jarboe thinks regulation by ABC is probably inevitable. As I write, the bill is being amended and similar bills are being proposed all over the country, and especially in the South and Midwest, which account for the bulk of hemp-derived cannabinoid sales in the U.S. The specifics of the bill may have changed by publication time, but THC drinks are likely the direction that the industry will move toward.

And, whether it’s because of this bill or another, having weathered a turbulent decade that has seen the birth and meteoric rise of hemp-derived cannabinoids, Jarboe sounds both weary and resigned when he talks about getting out of the recreational hemp business. 

The Revolution Will Be Decarboxylated

_Tennessee Homegrown started in 2016, selling CBD. It does not get you high but is proven to have medicinal properties and can be especially effective in treating certain kinds of seizures. Back then, Tennessee was more tolerant of hemp production than many other states. Then the 2018 Farm Bill federally legalized large-scale cultivation of hemp and opened up the barn door for all sorts of hemp-derived THC products.

“The science is ahead of the law right now, and it’s probably going to stay that way,” says Whitt Steineker, an Alabama-based corporate lawyer and the co-chair of the Bradley law firm’s cannabis industry team. “That’s what makes some lawmakers really, really jumpy.” He estimates that about seventy percent of his business deals with cannabis.

What is legal, what isn’t, and why or why not are especially convoluted and confusing questions, precisely because many lawmakers don’t seem to understand the chemistry of cannabis. The Farm Bill legalized cannabis plants containing less than .3 percent of delta-9 THC, which is the compound traditionally responsible for getting people stoned. Delta-9 is what is illegal in states without either a medical or adult-use cannabis program. Other psychoactive cannabinoids, such as delta-8, are present in the plant, but in such small amounts that it was generally considered insignificant. But because cannabinoids all share a similar structure, after the Farm Bill legalized the mass production of hemp, it became possible to convert CBD into delta-8, delta-10, and other varieties of THC that can get people high but are not illegal.

Pretty much anything involving the science of cannabis can be traced back to Dr. Raphael Mechoulam, an Israeli chemist who isolated CBD (cannabidiol) and THC (tetrahydrocannabinol) in the early ’60s. These discoveries laid the foundation for virtually every other discovery about the chemical composition of the cannabis plant and the cannabinoid receptors in the human body. It was Mechoulam, along with collaborators, who identified a method for transforming CBD into delta-8 or delta-9 THC by heating the CBD in a solvent with an acid.

At the time, that discovery didn’t mean much because it wasn’t economically or legally feasible to do anything with it—there wasn’t enough CBD to convert, as hemp was still largely illegal to produce or process. But after the Farm Bill legalized hemp production, it meant that it was easy and permissible to produce large amounts of CBD. Small-time farmers and chemists began experimenting. The Farm Bill provided, Jarboe says, a loophole “big enough to drive a truck through.”

Delta-8 THC was the first big-hit product to be brought out by these chemists, and it began to pop up shortly after the first big harvest in all sorts of forms—gummies, vapes, seltzers, etc.—in bars and convenience stores all over the South in early 2020.

Delta-8 is generally thought to produce a slightly more mellow high than delta-9, because it binds less tightly to the cannabinoid receptors; some medical patients have found it more beneficial than delta-9 THC because they can still carry on with their day better than with traditional weed. As a long-time user of real weed who conducted a few journalistic experiments with delta-8, I can confirm that it does get you high and that, for me, it is a bit more chill, and better for sleep, than delta-9. For instance, eating thirty milligrams of delta-9 might be too much, making me feel a little wiggy and paranoid. But the same amount of delta-8 just makes me relaxed.

_To make things more complicated, there is THCA, which is legal and non-psychoactive in its natural state, but when heated (decarboxylated), it transforms into delta-9 THC. What that means is that people could grow high-THCA plants and the flower, or buds, would be perfectly legal, containing less than .3 percent of delta-9 THC—until you smoke them (thereby heating them) and the THCA converts to delta-9 THC. This is why you can, in Tennessee, walk into a convenience store and see a big jar of buds that might remind you of your dorm room dealer.

“Those people who were making the laws had no idea of the chemistry of decarboxylation,” says Jarboe. “They did not understand the concept.”

At first, Tennessee Homegrown had been reluctant to take advantage of the loopholes in the Farm Bill. They were happy making and selling CBD, and they were making enough money to survive doing it. But, eventually, both market pressures and curiosity pushed Jarboe and his partner Lee Crabtree to fully embrace the new, weird science of hemp-derived cannabinoids.

At the same time, they began to get consistent lab reports on the quality of their product. “In the past, before we had access to labs, you kind of guessed. I mean, there was no way, quantitatively, to know. ‘Okay, yep, that’s definitely about seventy percent CBD,’” Jarboe says. This perfect storm allowed them to have fun experimenting with chemical compounds. “We started playing,” he says. “We’re nerds.”

John Kerns founded New Bloom Labs in 2019, when he saw a market with what seemed to be an obvious upside. “In Tennessee, in 2019, the Department of Agriculture issued over three thousand lot permits for hemp grows, and that was up from a few dozen,” he says. “At the time, everyone was sending their material to principally Colorado or Massachusetts for testing, because that’s where the programs existed at the time.” The problem with that, Kerns says, is “folks were waiting three weeks, a month for test results.” He knew that a local testing facility could turn around results quicker, and that it could continue to grow with the industry. But the cannabis business was volatile. “There was just no predictability whatsoever,” Kerns says. “I would have customers that would be in business, obviously doing a great deal of business, sending samples every single day, and all of a sudden, they just disappear.”

One of the early effects of the Farm Bill was to sink the price of CBD. In 2017, just before the Farm Bill, Tennessee Homegrown was able to get about $80 for a pound of raw hemp matter (or biomass). By the end of 2020, that same pound went for about $8. There was virtually no way to make good money off CBD anymore—but if you could convert it to THC, then there was an entirely new, and much bigger, market, attracting essentially anyone who would like to get legally high in a state that still prohibited delta-9.

Kerns says his lab got its first samples of delta-8 THC in February 2020, but not long after that “a majority of material we were testing was delta-8.”

So, the market got flooded again, this time lowering the price of delta-8. “Within eighteen months the price of a kilo of delta-8 dropped from several thousand dollars down to three or four hundred,” Jarboe says.

Lawyers, Gummies, and Money

_The gray-area legality of these hemp-derived cannabinoids created a nightmare for law enforcement, who could no longer assume that if it looked like weed and smelled like weed, it was weed. In early 2018, seventeen store owners in Rutherford County, Tennessee, where Tennessee Homegrown’s farm is, were arrested and had their stores padlocked for selling CBD gummies in what has been called Operation Candy Crush. Raiding that many businesses was surely intended to send a message—but it backfired in dramatic fashion.

“Because these businesses had been making a fair amount of money, they were all lawyered up,” Jarboe says. All but one of the store owners accepted a settlement for unlawful seizure in 2021 that ultimately netted a total $1.3 million split among the plaintiffs. A recent lawsuit in Sevierville, Tennessee, claims that authorities seized $850,000 of legal hemp, believing it was illegal cannabis. “This case exposes a critical failure in law enforcement’s approach to hemp,” attorney Alex Little told the local news station.

The problem of distinguishing hemp from illegal cannabis makes the job of law enforcement that much more difficult and has caused many to want to outlaw hemp altogether. “There was a real threat in Tennessee that essentially the entire industry could become prohibited,” says New Bloom’s Kern, who, along with other industry figures, worked with the Tennessee General Assembly to craft regulatory legislation.

“The statute itself, I think, was sort of exactly what the industry was looking for,” says Hunter Robinson, a Nashville-based lawyer who works with the Bradley firm’s cannabis industry team. “It said you can’t sell to people under twenty-one. The products need to be back behind the counter, minimum testing requirements, etc. And everybody’s like, ‘great.’”

Some states, such as South Carolina, currently have no age restriction on delta-8 products and are rushing legislation to deal with the obvious problem of underage use. But beyond that clear fix, virtually every other aspect of regulation faces a confounding number of issues across states. The problem in Tennessee came when the Tennessee Department of Agriculture (TDA), which was put in charge of implementing the regulations to enforce the statute, did it in a way no one was expecting. “The TDA said total THC is what counts, and total THC takes into account the THCA that is present in the hemp. And THCA, when it is burned, converts into delta-9 THC,” Robinson explains. In effect, THCA would count as delta-9, and that, according to Robinson, “would essentially ban THCA flower in Tennessee.”

Robinson says that his clients believe the rule would knock out anywhere from forty to eighty percent of their business. Jarboe calls appointing the TDA, which normally only deals with more strictly agricultural issues, “the dumbest thing in the world,” because the agency has no expertise in regulating consumer products sold in a baffling variety of locations. Various injunctions filed in response to industry lawsuits paused the new regulation, which finally went partially into effect last December, without the THCA ban. But virtually no one is happy with the state of things.

This dissatisfaction, which Robinson says is felt by folks in the industry as well as the legislature, led many to the conclusion that ABC might actually be a more apt overlord. “Putting it into a regulatory agency that has a little more experience with . . . a vice area [like alcohol] . . . could maybe be a good thing,” he says.

Whether it is a good thing remains to be seen, but there is a certain logic and a lot of momentum behind the plan. “Tennessee . . . probably has the strongest alcohol lobby of any state,” says Robinson. “So read into that what you will.”

_But it’s not just Tennessee. “You’re going to see more and more legislation in states that are either banning consumable hemp products, or very much clamping down on them, but that allows for beverages separately and has them regulated like beer, like wine might be regulated already in the state,” says Slates Veazey, who works with Robinson and Steineker on the Bradley law firm’s cannabis team. He cites a bill in Mississippi that “doesn’t ban necessarily everything right now other than beverages, but it does have a carve-out for beverages and treats them separately.”

With studies showing alcohol consumption trending downward, especially among millennials and Gen Z, alcohol companies are looking for other beverages that might reach that demographic. And Jarboe says of hemp, “One of the highest profit things you can do is a drink. God, has it got a sweet margin.”

A market research report released in February estimated that cannabis beverage sales amounted to $382 million last year and will nearly double that by 2029.

“If I were buying stock, I’d be buying,” says Alabama lawyer Steineker.

But Big Booze isn’t the only threat in the new legislation for smaller businesses like Jarboe’s in Tennessee. The proposed legislation would also prohibit selling products in grocery or convenience stores and would require a business to have at least $750,000 on hand in order to operate. This last bit would definitely put the squeeze on small businesses—and feels to many like another move to give away the industry to big alcohol companies.

“I’m definitely aware of instances where people writing the laws were working with well-heeled operators who just sort of used that as a gate or a barrier to entry for potential competition,” says Steineker. But, he says, the monetary requirement is also justifiable, because it requires a certain amount of money to be able to operate safely and comply with the regulations. “If they’re cutting it that tight, you know, are they cutting corners on their testing, the quality of the products and that kind of stuff?” Still, Steineker sees how a cynical application of the statute could “have a disparate impact on less well-off companies or individuals.”

Jarboe thinks that as a “small, two-family farm that’s vertical, that’s been around for going on ten years,” he could be one of those individuals disparately impacted right out of the business if ABC takes control.

It may be that the bills currently being debated in Tennessee don’t pass, but it seems like a good bet that THC seltzers, with some alcohol-like regulation, will be the future of hemp-derived cannabinoids, whether the industry’s pioneers like it or not.

“One thing about the cannabis business is, ultimately, it’s business,” Jarboe says. “Business is a bigger word than hemp.”

This story appears in the Summer 2025 print edition as “The Delta-8 Blues.” Order the Y’all Street Issue here.