Legal marijuana is a $5 billion business in the U.S., and Steve Janjic figured he would get a piece of it. With a commodity exchange. For a product that can’t be transported across state lines.

Not to worry.

“It’s never easy to pioneer an industry,” said Janjic, a former foreign-exchange executive at Tullett Prebon LLC who has put $1 million into Amercanex Corp., an electronic cannabis-trading platform that handles sales of about 100 to 150 pounds of weed a week.

That’s not exactly blockbuster in a country with an estimated 20 million marijuana consumers.

But it might not be too bad in the case of a young exchange for a psychoactive substance transitioning to legitimate, or sort of legitimate, considering it is illegal under federal law. Janjic and other Wall Street veterans backing Amercanex take the very long view.

Only four states, including Colorado, and the District of Columbia have sanctioned pot for recreational use. Nevada might join them after a November vote. In 23 states, the drug is allowed for medicinal purposes. Polls show a majority of Americans think it should be as licit as beer, giving Amercanex high hopes.

“I look at this as an early Nymex,” said Richard Schaeffer, a former chairman of the New York Mercantile Exchange. “I look for this to become a very substantial matching engine bringing buyers and sellers together.”

Schaeffer, 63, is Amercanex’s chairman, and Janjic, 49, is CEO and co-founder. Others from the financial world involved include futures trader Timothy Petrone, a member of Nymex and the Chicago Board of Trade, former Nymex board member David Greenberg, and James McNally, who has been a member of Nymex, the Commodities Exchange and the Hong Kong Futures Exchange.

For the record, none is a cannabis user, which is probably neither here nor there. Even the gluten-intolerant can get rich in wheat futures.

But is there serious money to be made trading the flowers and leaves of the cannabis plant? Amercanex isn’t alone in betting there will be, someday.

Sohum Shah, a 26-year-old with a degree from the University of Arizona, started the Cannabis Commodities Exchange three months before Amercanex got off the ground.

CCE operates only in Colorado, which in 2012 became the first state to vote to make recreational pot legal. Amercanex is in Colorado and California, the first to approve weed for medicinal use, and Janjic said there are expansion plans.

Limitations

The hurdles are sizable. For an exchange to fully function, a commodity has to have standardized specifications and some regulatory oversight, as products from corn to metals do, so everyone can be assured of exactly what they’re buying and selling, said Dale Rosenthal, who teaches finance at the University of Illinois at Chicago.

Weed comes in a wide range of quality and potency and price. Although there aren’t any futures contracts that trade on an exchange, there is at least one national gauge of the market, the U.S. Cannabis Spot Index compiled by Cannabis Benchmarks, a division of New Leaf Data Services LLC.

Amercanex buyers know the quality of what they’re buying because the exchange sends what’s sold on its platform to a laboratory for evaluation and shares the results, Janjic said.

But here’s the rub: Buyers and sellers must be in the same state.

The U.S. government regulates interstate commerce, and selling or possessing marijuana are federal crimes. As is sending it across borders, and Amercanex is an exchange for spot trades of physical purchases, not paper-only futures or options contracts.

Right now, federal law is “the risk in this game,” Janjic said.

“It’s really fun”

In Colorado, purveyors were required until January to cultivate what they sold, and most still do.

“The only way that I think you can really be successful is by growing your own,” said Bruce Nassau, the CEO of Tru Cannabis, which has five stores. “If you’re buying from a wholesaler, you’re screwed.”

In Oregon and Alaska, merchants are allowed to use their own raw materials, but Washington legalized in 2014 with a law forbidding retailers from doing so.

“In a system like that, exchanges become more useful,” said Adam Orens, founding partner of the Marijuana Policy Group.

Amercanex started in July 2014 with 20,000 seats, though it has retired about 8,000. The seats began selling for $2,500 each and are now going for $10,000, Janjic said; 7,000 are are still up for grabs.

Dixie Brands, a Denver-based maker of tetrahydrocannabinol-infused products, bought a seat last year and has an equity stake. Amercanex will help distribute its goods more efficiently, said CEO Tripp Keber.