BlackRock President Robert Kapito said on Thursday that his firm is looking to invest in cannabis stocks at a conference in Toronto.

Kapito said the world's largest asset manager is sitting on the sidelines for now because most bank custodians won't clear cannabis stocks.

Kapito said he's not a big supporter of cannabis, but the "world wants to go the other way."

The world's largest asset manager wants to invest in cannabis stocks — but is sitting on the sidelines for now.

BlackRock President Robert Kapito said on Thursday morning his firm is looking to invest in the red-hot sector at the Prime Quadrant Conference in Toronto, Canada.

"We will be investing, but right now because of issues with states and the federal government in the US, some of the custodians will not clear cannabis stocks and we will have to wait until that happens," Kapito said, per Bloomberg.

Cannabis is legal for recreational users in nine states and for medical users in a further 31 states, though the US federal government considers it a Schedule I drug.

Kapito said while he's not a big supporter of cannabis, the "world wants to go the other way."

"I don't think the story ends well," Kapito said. "That's my personal story but this is what the world is looking at."

Until recently, institutional investors have steered clear of the volatile cannabis sector, even though Canada legalized the drug for all adults earlier in October.

Canada's largest pension funds, including the Ontario Municipal Employees Retirement System (OMERS) and the Canada Pension Plan Investment Board (CPPIB), so far haven't invested.

For the most part, high-net-worth individuals and family offices have put the bulk of the money into the sector.

Hedge fund billionaire Leon Cooperman has invested personally — not through his fund — in Green Thumb Industries, an Illinois-based cannabis cultivator. And Tiger Global's venture arm invested in Green Bits, a software platform for cannabis dispensaries in April.

The sector gained mainstream attention after Constellation Brands, the beverage giant behind Corona and Modelo, sank $4 billion into Canopy Growth, a Canadian marijuana cultivator in August.

Some analysts expect cannabis to be a $75 billion industry — or larger — globally by 2030.

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