Make the cannabutter: Preheat oven to 240 degrees. Place cannabis buds on a sheet tray, and bake at 240 degrees for 40 minutes. (This is called decarboxylation which will help activate the THC. Do not skip this step.)
Once baked, the buds will become crumbly. Break them into smaller crumbles and set aside.
In a medium saucepan, heat butter and water until they reach a low simmer. Add marijuana crumbles and set heat to a very low simmer. Do not boil. Make sure crumbles are not touching the bottom of the pan; if so, add a bit more water until they float. Cook uncovered for 3 hours, adding more water if necessary.
Place a fine mesh colander covered with cheesecloth over a large bowl. Pour cannabutter liquid over cheesecloth colander. Use a spatula to push any excess liquid through. Discard drained buds. Cover bowl in plastic wrap and refrigerate for 3 hours or overnight. The butter will harden on top of the water. Use a knife to help remove the butter disc from the bowl and discard the water. Your cannabutter is now ready to use!