The Drug Enforcement Administration (DEA) is gearing up to reclassify marijuana in the US as a less dangerous drug, according to new reports, and cannabis company CEOs say the move has been a long time coming.

In what Curaleaf (CURLF) CEO Matt Darin called “a historic moment” for the industry, a DEA proposal reportedly seeks to reclassify marijuana from a Schedule I narcotic — a category that includes LSD, ecstasy, and heroin — to a Schedule III narcotic, which includes ketamine, codeine, and steroids.

The proposal will still need to go through a lengthy process to become finalized and, crucially, will not legalize the substance in the US, but the federal reclassification of marijuana has been a long-term goal for the cannabis industry.

“Any step forward here, I think, certainly helps in the normalization of cannabis and demonstrates to legislators that there is widespread support for it,” Darin told Yahoo Finance. “While this is certainly a different process [than cannabis banking reform and other legislative actions], ... I think it absolutely sends a signal to those in D.C. that there is widespread support for this, that the federal government acknowledges that there is a medicinal benefit to cannabis, and that, ultimately, this belongs regulated similar to other industries.”

Trulieve (TCNNF) CEO Kim Rivers highlighted that the DEA’s decision signifies progress on the issue after President Joe Biden and the Food and Drug Administration (FDA) requested a review of how cannabis is scheduled.

“The FDA findings were actually that marijuana is safer in many respects than alcohol, which is interesting in terms of having that on the record,” Rivers said. “It really is a critical first step as we think about additional regulatory and policy changes for the industry.”

Though cannabis stocks generally saw an increase in value following the news of a possible reclassification, they've continued to face volatility. The AdvisorShares Pure US Cannabis ETF (MSOS), which tracks shares of cannabis companies, jumped over 25% on April 30 after the news broke but pared those gains in the following week.

Shares of Curaleaf and Trulieve, two of the largest cannabis companies, had similar trajectories, reaching their highest values for the year before settling down. Trulieve reported a narrower first quarter loss in its earnings before the market open on Thursday and Curaleaf will report earnings after the market close.

What reclassification means for the industry

A growing number of states support the legalization of marijuana. Currently, recreational cannabis use is legal in 24 states, while medical use is legal in 38 states.