UP IN SMOKE: One of California’s most expensive licenses is now basically worthless.

A license to legally sell cannabis in California was once a coveted item, with some selling for millions of dollars. But now, as the California market’s struggles have left some pot licenses effectively worthless, that exuberance has turned into gloom.

Case in point: One cannabis company is offering its retail license in the Southern California city of Oxnard for “free” to anyone who will assume responsibility for paying the lease on the retail location, which has not yet opened for business. The listing still prices the license at $35,000, but broker Meilad Rafiei confirmed to SFGATE the seller is willing to walk away without getting any cash.

“From day one I was telling [the license holders], I don’t know if there’s any value here,” Rafiei said.

Rafiei, the CEO of cannabis industry consulting firm WeCann, said the Oxnard license could have once been sold for as much as $3 million, making the current deal a stunning drop in value.

Ryan George, the CEO of 420Property.com, which is a marketplace for cannabis licenses and real estate, said during the early years of legalization, licenses could trade from $500,000 to $3 million, with one Santa Ana license selling for $8 million. Now he’s increasingly seeing licenses trade for free as they become “effectively worthless” in certain areas.

“Fast forward to today, and the picture has changed dramatically. Market saturation, regulatory challenges, and competition from the illicit market have driven values down,” George said in an email.

As Steve wrote last week, “Sacramento forgot that, long before legalization, California had a robust ‘unlicensed’ infrastructure in place for the production, distribution, and sale of pot. Were they stupid enough to think they could tax and regulate licensed producers and sellers to the point where their product was more expensive than the ‘unlicensed’ stuff — and still collect their precious taxes? I suppose they were that stupid.”