Cronos Group will become the first marijuana company to trade on a major US stock exchange.

The company owns and operates businesses that are licensed to grow and sell weed in Canada, where medical marijuana is legal.

The listing could signal to governments and investors that the legal marijuana industry has arrived, according to Cronos Group's CEO.

Cronos Group, a Canadian company that's like Proctor & Gamble for pot products, has received approval from the Securities and Exchange Commission to begin trading on the Nasdaq.

The Toronto-based company plans to list under the symbol "CRON" as early as February 26, Michael Gorenstein, CEO of Cronos Group, told Business Insider.

The event marks a major milestone for the marijuana industry. Cronos Group will become the first company that grows and sells marijuana to list on a US stock exchange. American companies that process the plant have been sidelined because marijuana is still federally illegal.

Cronos Group is not the first company affiliated with the marijuana industry to list on a US stock exchange, however. Most others are focused on ancillary products for pot growers — like fertilizer and lighting equipment — or biotech, developing drugs derived from marijuana.

But Cronos Group is the first "pure play cannabis company" to list, according to Gorenstein.

The company's listing could signal to governments, investors, and everyday Americans that the legal marijuana industry has arrived, according to Gorenstein.

"We are a legitimate company. This is a legitimate industry," Gorenstein said.

Founded in 2013, Cronos Group — which already trades in Canada — owns and operates brands in the business of marijuana cultivation and distribution. It owns 100% of both Peace Naturals and Original BC, which are licensed to grow and sell medical marijuana. Cronos also has a minority stake in a third cannabis producer, Whistler Medical Marijuana Company.

The company set out with the goal of changing the perception around marijuana. Cronos Group sells mostly flower (the green stuff you smoke) and oils derived from marijuana. They come in a variety of strengths and intended effects to suit customers' needs. Cronos has even patented some of its plant varieties.

Gorenstein said when many people are asked to picture a marijuana company, they imagine "some guy in their basement with a few lights on and pit bulls outside. We want to show that we treat cannabis like real medicine." He added, "We don't believe cannabis is a commodity."

Cronos Group is expanding its production facility in Ontario, Canada, in order to keep up with demand. Cronos Group

Gorenstein said he began a relationship with Nasdaq last year. The company was approved for an over-the-counter listing — a type of security that trades on an exchange dedicated to small companies. When Gorenstein wanted to graduate to the Nasdaq, the company spent six months being audited and reviewed by different independent committees before filing an application.

Gorenstein, who began his career as a corporate attorney at Sullivan & Cromwell, said he couldn't be sure if the Securities and Exchange Commission applied any more rigor in their review of Cronos compared to a company operating in another industry.

Medical marijuana is fully legal in Canada, and the government will legalize recreational use this year. North Americans spent $9.2 billion on legal marijuana in 2017, and sales are expected to pass $47 billion in 2027, according to a report from Arcview Market Research.

Sean Stiefel, cofounder of Navy Capital, a New York-based hedge fund that focuses solely on marijuana, said allowing Cronos Group to list is "a logical decision by Nasdaq."

"Cronos runs a legal business in their federal jurisdiction," Stiefel told Business Insider. He said it's no different than allowing offshore internet gambling companies to list on a US stock exchange, even though gaming exists in a legal gray area in the US.

Cronos Group does not have any ties to the US marijuana industry, but Gorenstein said if federal prohibition in the country ended tomorrow, "we would be there."