Something interesting is happening at the intersection of two of America's most talked-about beverage categories. Craft beer and cannabis, long-standing parallel movements, have been converging for years, both driven by consumer demand for quality, variety, and authenticity. But the nature of that convergence has evolved considerably, and where things stand today is more nuanced and more interesting than most early predictions anticipated.
This post covers the current state of cannabis-infused beer and beverages, what's actually driving consumer interest, how cannabis-infused beers are actually made, and where terpenes fit into all of it.
The Cannabis Beverage Market Today
The cannabis beverage category has grown substantially in recent years. THC beverage sales in the U.S. topped $1 billion in 2024, according to Whitney Economics, with analysts projecting growth to $10–15 billion if even a modest share of alcohol consumers make the switch. A 2025 BDSA report found that cannabis beverages achieved $54.6 million in sales in Q1 2025 alone, a 15% year-over-year increase, with markets like Michigan (up 112%), Ohio (up 79%), and Illinois (up 47%) driving particularly strong growth.
To put that in context: cannabis beverages still represent roughly 1% of total cannabis retail sales. That's a small slice of a large market, but the trajectory is consistent and the tailwinds are real. Non-alcoholic cannabis beverages dominate the category, accounting for the majority of sales, driven by health-conscious consumers who are drawn to the idea of a social drink that doesn't come with alcohol's calories, hangover, or loss of control.
Craft Beer's Headwinds Are Cannabis's Opportunity
One of the more striking developments of recent years is that craft beer, the category everyone expected to keep growing indefinitely, has hit a wall. Craft breweries produced 23.1 million barrels in 2024, down from 24 million the year before, and for the first time since 2005, more breweries closed than opened. The Beer Purchasers' Index, which tracks distributor orders, put craft at just 20 in early 2025, well below the 50 threshold that indicates a growing market.
The consumers most likely to drive craft beer's next chapter, Gen Z and younger millennials, are, as a group, drinking less alcohol than prior generations. Many of them are gravitating toward THC beverages and alcohol-free beer alternatives as social options: familiar in format, controllable in dosage, and free of the hangover that's increasingly seen as a deal-breaker. A 5 mg THC seltzer can offer a mild, predictable effect with fewer than 10 calories and no next-day consequences. For a generation that grew up with craft beer's ethos of quality and intentionality, cannabis-infused beverages offer a natural extension of those values.
This isn't necessarily bad news for craft brewers who are paying attention. The same creativity, community, and experimentation that defined the craft beer movement are exactly what the emerging cannabis beverage space needs. A number of forward-thinking breweries are already making the pivot, or at least exploring the overlap.
What Cannabis-Infused Beer Actually Looks Like in Practice
The phrase "cannabis-infused beer" covers a range of very different products, and the distinctions matter.
At one end of the spectrum are THC-infused non-alcoholic beers, products brewed to replicate the sensory experience of beer (carbonation, bitterness, body) while using THC or CBD as the active compound instead of ethanol. At the other end are conventional alcoholic beers that incorporate cannabis terpenes for flavor and aroma, with no cannabinoids at all. Between these sit CBD-infused beers, hemp-infused malt beverages, and a growing range of hybrid formats that mix cannabis with functional ingredients like caffeine or adaptogens.
Each of these products is governed by different regulations, appeals to somewhat different consumers, and presents different technical challenges for the brewer. Understanding the distinctions is useful whether you're a consumer trying to figure out what to buy, a homebrewer curious about what's possible, or a commercial brewery exploring the category.
CERIA Brewing: Keith Villa and the Vision of Cannabis as Beer
No discussion of cannabis-infused beer is complete without Keith Villa. Villa spent over 30 years at Coors and MillerCoors, where he created Blue Moon Belgian White Ale, one of the best-selling craft-style beers in American history. He left to found CERIA Brewing Company in Colorado in 2018 with a specific ambition: to bring cannabis to mainstream social settings in the most familiar possible format.
CERIA's beers are non-alcoholic, THC-infused, and brewed using the same traditions that Villa spent his career refining. The beers are designed to drink like beer, carbonated, hop-forward, with the bitterness and body that beer drinkers expect, while delivering a controlled, predictable cannabis experience instead of an alcohol buzz. CERIA currently offers multiple styles, including a Belgian-style white ale and an IPA, and has described its core mission as making cannabis consumption as socially unremarkable as ordering a pale ale.
Villa's background matters because it gives CERIA credibility in traditional beer-making, which most cannabis brands lack. The product isn't a novelty; it's a serious attempt to create a category by someone who understands how to brew beer and how beer fits into social culture. Whether the wider market catches up to CERIA's vision depends largely on how quickly federal regulations around THC in beverages evolve.
Bale Breaker, Sungaze, and the Brewery-to-Cannabis Pipeline
CERIA isn't the only brewery that has made a serious move toward cannabis. Bale Breaker Brewing in Yakima, Washington, a brewery with deep roots in hop farming, operating in the heart of one of America's premier hop-growing regions, offers a compelling case study in how a craft brewer can leverage existing expertise to pivot into cannabis.
Co-owner and brewmaster Kevin Smith and his team were already growing hops on land that had supported agriculture for generations. The botanical proximity of hops and cannabis, both members of the Cannabaceae family, both terpene-rich, made the exploration feel natural rather than forced. After market research and partnerships with local cannabis cultivators, Bale Breaker launched Sungaze Cannabis Company as a separate brand, bringing the craft brewery's quality standards and consumer relationships into the cannabis beverage space.
Smith has described the goal similarly to how Villa frames CERIA: he wants people to consume marijuana the way they'd reach for a pale ale at a social gathering, casually, without stigma, and with a clear sense of what they're getting. The IndieWave IPA, one of Sungaze's flagship products, became one of the more visible examples of the craft brewer-to-cannabis pipeline, a West Coast-style IPA in spirit and execution, built on the terpene and flavor logic that hop-forward brewing already shares with cannabis.
CBD-Infused Beers: The More Accessible Category
While THC-infused beer generates the most attention, CBD-infused beers are in many ways the more commercially accessible part of this market, and a significantly larger one by volume. CBD is non-psychoactive, federally legal under the 2018 Farm Bill when derived from hemp, and already embedded in mainstream wellness culture. That makes CBD-infused beers easier to distribute, easier to market, and easier for consumers to try without the hesitation that comes with THC.
A number of well-regarded breweries have explored CBD beer seriously. Coalition Brewing in Oregon became one of the early leaders, producing seasonal CBD beers, including the Two Flowers IPA and Herbs of a Feather, a lemon-and-basil sour CBD beer that demonstrated just how creatively CBD could be woven into unconventional beer recipes.
Long Trail Brewing in Vermont partnered with local hemp producer Luce Farm to create the Medicator IPA, which incorporated hemp oil and terpenes to deliver a recognizably cannabis-influenced character. BRLO, a Berlin-based brewery, released Hemp Session, a light, refreshing blend of hop and hemp flavors aimed at the European CBD market.
Lagunitas, Heineken's California craft label, took the concept in a different direction with Hi-Fi Hops, technically a sparkling water rather than a beer, but IPA-inspired in its hop character and infused with both THC and CBD. It occupies the same cultural space as craft beer while largely leaving behind traditional beer-making conventions.
The CBD-infused beer category has its limitations. The FDA has not approved CBD as a food additive, which creates regulatory ambiguity in the U.S. market that varies by state. Some breweries that were producing CBD beers have paused or discontinued those lines while the regulatory landscape clarifies. But consumer demand for CBD-infused beverages remains strong, and the category continues to attract new entrants and new formats.
How Cannabis Is Actually Infused into Beer
Getting cannabis's active compounds into beer in a stable, predictable, and palatable way is more technically demanding than it might seem. THC and CBD are fat-soluble, which means they don't naturally mix with water, a fundamental challenge for any water-based beverage. Ethanol, which is present in conventional alcoholic beverages, can act as a carrier for cannabinoids, but combining alcohol with THC is federally prohibited in the U.S., which means brewers working with THC have to find other solutions.
The main approaches brewers and manufacturers use are:
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Nanoemulsion: The most commercially significant innovation in cannabis beverages. Cannabinoid oil is broken into nanoscale particles and encapsulated in a water-compatible coating, making it miscible with water and dramatically improving bioavailability. Nanoemulsified cannabis beverages can produce onset times of 15 to 30 minutes, much closer to alcohol's effect curve, and deliver consistent, predictable dosing. This technology has been the primary driver of the category's recent growth.
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Pre-fermentation infusion: Cannabis extract is added to the wort before fermentation begins. The heat of the brewing process can affect cannabinoid potency and flavor, and brewers must carefully manage temperatures to preserve the integrity of the compounds. This method integrates cannabinoids into the beer at a fundamental level but requires precise control.
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Post-fermentation infusion: Cannabis oil or extract is added after fermentation is complete. This gives the brewer greater control over dosage and minimizes heat-related degradation of cannabinoids, but requires careful emulsification to avoid separation. Most commercial cannabis beer recipes that prioritize consistent dosing use some version of this approach.
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Dry hopping with terpenes: Borrowing a technique from hop-forward brewing, some producers add botanical terpenes during or after fermentation, the same way a dry hop addition works, to layer in cannabis-derived aromas without introducing cannabinoids. This is legal across a far wider range of jurisdictions and produces beers with genuine cannabis aroma character without any psychoactive effects.
Traditional beer making involves fermentation as its defining process: yeast converts the sugars in malted grain into ethanol and carbon dioxide, producing alcohol and carbonation. Cannabis-infused non-alcoholic beers take the brewing process through fermentation and then either remove the alcohol (through vacuum distillation or other methods) or formulate the beer recipe to minimize alcohol production from the start, before adding cannabinoids separately. It's a genuinely complex technical undertaking, which is one reason the best cannabis beers tend to come from producers with serious brewing credentials.
Where Terpenes Come In
Hops and cannabis are botanical cousins, both members of the Cannabaceae family, and they share many terpenes. Myrcene, for instance, is one of the most abundant terpenes in both hops and cannabis, contributing the earthy, dank, slightly fruity aroma that hop-forward beers and certain cannabis strains share. Linalool, caryophyllene, and pinene also appear in both plants, which is why an intensely dry-hopped West Coast style IPA can smell, to some noses, remarkably similar to cannabis.
Brewers have begun deliberately exploiting this overlap. By adding botanical terpenes, sourced from non-cannabis plants but chemically identical to the terpenes found in specific marijuana strains, to finished beer during or after fermentation, brewers can create products with the specific aroma and flavor of named cannabis strains. This works without using cannabis biomass and without navigating the regulatory constraints that come with it.
In 2024, Long Live Beerworks in Boston partnered with local dispensary Rooted In to release a cannabis-terpene-infused IPA, celebrating the flavor crossover between hops and cannabis. Crooked Hammock Brewing created a Pineapple Express-inspired NEIPA using botanical terpenes that carried the citrus and tropical character of the Cannabis sativa strain it referenced, with no THC whatsoever. Lagunitas brewed SuperCritical, an ale made with terpene oil that leaned into the flavor overlap between hops and cannabis as a flavor experience in its own right.
The bitterness and aroma logic of dry hopping maps almost directly onto the addition of terpenes. Terpenes added post-fermentation behave similarly to late dry hop additions: they contribute volatile aromatic compounds that would be partially lost to heat during brewing but preserved when added cold and late. Brewers already familiar with managing dry-hop timing, temperature, and contact time have the foundational knowledge to work effectively with terpenes.
This is where True Blue's flavor library and strain profiles become directly relevant to brewers. Botanical terpenes are legal to use in food and beverage applications, compatible with standard brewing processes, and available in strain-specific profiles that allow a brewer to reference a specific cannabis variety, by name, by aroma, by character, in their product story. They deliver something that cannabis biomass often can't: batch-to-batch consistency, which is non-negotiable for any commercial beer recipe.
Cannabis, Caffeine, and the Hybrid Beverage Frontier
One of the more interesting recent developments in cannabis beverages is the emergence of products that combine cannabinoids with other functional ingredients, most notably caffeine. The logic is straightforward: THC's relaxing effects and cannabis's complex flavor profile pair interestingly with the alertness that caffeine provides, producing a balanced experience that some consumers find preferable to either alone.
Cann, one of the higher-profile cannabis beverage brands, released Passion Peach Mate in 2024, a THC-infused drink built around yerba mate as the caffeine source, designed specifically as an alcohol alternative with an added energy dimension. Several other brands have explored coffee-based cannabis beverages, cannabis cocktail mixers, and hybrid drinks that incorporate adaptogens alongside cannabinoids.
These hybrid formats are expanding what "cannabis beverage" means in practice and are attracting consumers who might not have considered cannabis drinks otherwise. They also present new formulation challenges around how caffeine and cannabinoids interact, an area where terpene selection can play a role in shaping the drink's overall sensory experience.
For Homebrewers: What's Possible and What to Know
The homebrewing community has always been one of the most important incubators of beverage innovation, many of the ideas that become commercial products start as someone's weekend experiment. Cannabis beverages are no different, and homebrewers have been experimenting with cannabis, CBD, and terpene additions to homemade beer for years.
For homebrewers in states where marijuana is legal for recreational use, the most straightforward approach is terpene addition. Botanical terpenes can be purchased legally, require no special equipment, and can be added to a finished homebrew much like a dry hop, a small dose dissolved in a neutral carrier oil or directly into the beer at packaging. A few drops per bottle is typically sufficient; terpenes are potent, and adding too much produces harsh, resinous off-flavors rather than the nuanced cannabis aroma most brewers are after.
For homebrewers interested in THC or CBD infusion, the technical path is more involved. Water-soluble CBD extracts are available commercially and can be added to finished beer with reasonable consistency. THC infusion at home is more variable and depends heavily on the quality of the extract and the emulsification method used. The most reliable approach is to use a nanoemulsified THC or CBD oil designed for beverage applications; several are marketed specifically for this purpose, rather than attempting to add raw cannabis extract directly to beer, which will produce poor results due to the oil-water separation problem.
The homebrewing angle is also a practical reason to experiment with terpene profiles before committing to a commercial formulation. True Blue's sample pack of any five strain profiles is a low-cost way to test which terpene characters work well with a given beer style before scaling up.
The Regulatory Picture
The legal landscape for cannabis-infused beer and infused beverages varies significantly depending on what's in the drink and where it's being sold.
For THC-infused beverages derived from hemp (under 0.3% delta-9 THC by dry weight), the 2018 Farm Bill created a federal framework that has allowed a wave of products to reach mainstream retail, convenience stores, online shops, and in some states, standard alcohol distribution channels. This is the category that's grown most rapidly and most visibly.
For beverages that combine ethanol with THC, federal law remains a barrier. The TTB (Alcohol and Tobacco Tax and Trade Bureau) does not currently permit adding THC to alcoholic beverages, meaning a true cannabis beer in the sense of a conventionally alcoholic beer with THC remains off the table at the federal level. Products like CERIA's beers work around this by removing the alcohol from the equation entirely.
Cannabis terpene-infused beers that contain no cannabinoids operate in the most permissive regulatory environment. They're treated as flavoring ingredients, not cannabis products, and can be brewed and distributed wherever the brewery's standard products are sold. For craft brewers who want to explore this space without legal complexity, terpene-only infusion is the most accessible entry point.
State-level rules add further complexity across all categories. Any brewer or beverage producer exploring cannabis infusion should work with legal counsel familiar with both cannabis and beverage alcohol regulation in their specific market.
What This Means for the Craft Beer Industry
The craft beer industry is at an inflection point, and cannabis represents one of the more credible paths forward for breweries looking to stay relevant with consumers who are drinking less alcohol. The options range from low-commitment, adding botanical terpenes to an existing beer style to create a cannabis-adjacent flavor and aroma experience, to more substantial pivots like launching a separate non-alcoholic THC beverage line or partnering with a local dispensary.
The breweries best positioned to succeed in this space are likely the ones that approach it the way the best craft brewers approach everything: with genuine curiosity about ingredients, a willingness to invest in quality, and an honest relationship with their customers about what they're making and why. The consumers driving growth in cannabis beverages are exactly the consumers who respond to that approach.
If you're a brewer or beverage producer interested in exploring terpene-forward formulations, True Blue's strain profiles and flavor library are a practical starting point. Our terpenes are botanical, consistent batch to batch, and available in the strain-specific profiles that make cannabis-adjacent flavor storytelling possible without the regulatory complexity of working with cannabis itself.