Denver, Oakland and Santa Cruz have decriminalized psilocybin – the active ingredient in psychadelic mushrooms. Chicago could be next.

Alderman Brian Hopkins (2nd Ward) recently introduced a resolution to decriminalize entheogenic plants in the city, citing its healing potential for ailments including PTSD and chronic traumatic encephalopathy.

Similar to cannabis, psilocybin is considered a Schedule I substance by the federal government and accordingly is a crime to consume, purchase or study (except under very tightly controlled conditions).

A confluence of liberalizing FDA restrictions, mainstreaming by the likes of Michael Pollan and Gwyneth Paltrow, and criminal justice reform efforts will likely lead to more municipal decriminalization and basic research and development funding.

So how are investors eyeing this market?

“There is a whole audience waiting to see these compounds become available,” said Andrew Pendrill, the Scarsdale, New York-based CEO of EI Ventures, a new platform portfolio company of Hawaii-based biotech holding company Orthogonal Thinker, which focuses on psilocybin-focused investments. “I think every player in the industry is doing the right thing working to get clinical data, and prove to the authorities that this works.”

A former pharmaceutical executive, Pendrill noted that decriminalization is only an initial step. Such is the case with the cannabis industry, significant research and development is hindered by federal law, but beginning to thrive internationally in countries including Israel and England.

There is a growing albeit nascent community of investors in this space. Peter Thiel’s London-based company Compass Pathways has United States FDA approval to study the plant’s potential impact to treat depression.

Vancouver-based Codebase Ventures last month announced its first investment via its Titan Shrooms and Psychedelics Inc. subsidiary, in Netherlands-based Red Light Holland Corp. The company notes  press release that it is “actively seeking investment opportunities at the forefront of the mushroom and micro-dosing psychedelic healthcare sector.”

The Illinois-based cannabis investors queried on the subject are taking a wait-and-see approach to any commercial Cryptical Envelopment opportunities.

Progress here, of course, figures to be nonlinear.

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Brad Spirrison is a journalist, serial entrepreneur and media ecologist. He lives in Chicago with his son. Interests include music, meditation and Miles Davis.