As relevant here, it blocks REM sleep and thus dreams. This can have downsides.

That is only in high THC strains. Many people use cannabinoids before bed as a supplement to encourage REM sleep.

It can also have significant upsides.

Pot triggers panic attacks in some people though.

I quit marijuana, but I did use it daily for years. An under appreciated aspect of pot and anxiety is the strain consumed. Broadly speaking pot is put in to two categories: indica and sativa. More indica leaning strains will produce more of a body depressing feeling of relaxation and tiredness. Sativas are more associated with alertness, and as I used pot while doing other things I only consumed pure sativas. However some strains of pure sativa are particularly prone to increasing anxiety. When I encountered those strains I had to stop consuming them and look for something else. Dosage is also very important. I consumed only roughly a pea-sized amount of ground flour in a sitting. High doses of sativa are much more likely to highten anxiety. I think it’s common for people to take a big rip of pot and suffer negative side effects. Very small doses are under appreciated I believe.

That said I quit marijuana early this year. I think overall my anxiety has decreased. I believe I may have been masking emotional problems, and quitting marijuana made it easier for me to process them. However if someone is having nightmares, they may consider smoking indica before bed. It may always depend on the strain, but I believe indica is unlikely to trigger panic attacks.

Particularly if you take too high a dose. If it happens, I recommend reducing the intake.

It happens to me with only the tiniest little green speck in a bowl. Regardless of strain. Sometimes it's because someone took to much, but some people really do just get panic attacks from it.

I used to be a daily smoker, then something in my body just flipped. I have a couple friends where the same thing happened in their early 30s.

I've gotten bad anxiety from smoking too much in the past, but these are different. Full blown panic attacks with heart-attack-like symptoms and crushing fear. (My cardiologist checked me out, it really is just panic attacks).

It did used to be great at preventing nightmares for me (and it was fun). Sure, sleep quality was worse than ideal but I almost never had an ideal night of sleep. But now I've tried too many times to find "the secret" to stop me from having panic attacks, nothing works and it's just made me become anxious at the sight/smell of weed.

Interesting, thanks for sharing. If you haven't tried it, Alprazolam (Xanax) has been a miracle for panic attacks, although these days it's pretty difficult to get from doctors. Modern American society seems to have decided that any medication that can possibly be abused is evil and must not be used even if somebody could really benefit from it. If you get some though, do NOT take it all the time and build a physical dependence. Withdrawing from Benzos is worse than opioids. If you only take it occasionally though you won't have any issues.