Cannabis industry leaders in Chicago commended President Donald Trump for signing an executive order Thursday that could reclassify cannabis as a less dangerous drug and create a path for further medical research.

The move would change cannabis from a Schedule I drug, alongside drugs like heroin and LSD, to a Schedule III drug, with substances like ketamine, codeine and anabolic steroids.

Despite possible reclassification, marijuana remains illegal for recreational use at the federal level. Medical cannabis is legal in 40 states and Washington, D.C. Many of those states, including Illinois, have also legalized it for adult recreational use.

“The reclassification of cannabis is a long-overdue step in the right direction,” said Omar Delgado, vice president of retail at Chicago-based dispensary Ivy Hall. “For years, our industry has navigated unnecessary obstacles due to outdated federal policies that perpetuated stigma and slowed progress.”

Ivy Hall was one of Illinois’ first “social equity” dispensaries under a state program that intended to diversify the cannabis industry by giving a leg up to owners who live in an area that has been adversely impacted by the drug war or have a cannabis-related criminal conviction.

Marijuana reclassification would also remove a tax burden on weed businesses that currently prohibit them from reporting ordinary business expense deductions from their taxable income. Large multistate operators, some of which are headquartered in Chicago, could see savings of up to $1 billion by paying less in taxes, industry leaders have said.

Companies may also attract more investors and be allowed to use credit card transactions after reclassification.

George Archos, founder and CEO of Chicago-based cannabis giant Verano, called the executive order a “transformative policy shift that paves the way for America’s next great homegrown industry to finally reach its full potential.

“We look forward to the new opportunities rescheduling will provide cannabis businesses of all sizes, including critical banking and regulatory reforms that will unlock additional health, wellness and economic benefits for communities nationwide,” Archos said.

Trump’s executive order also aims to increase medical research into THC products, as well as those with CBD, which is another compound in marijuana that, unlike THC, does not create the “high” effects from consumption. CBD is legal and a popular choice for treating pain and anxiety.

Smart Approaches to Marijuana, which has pushed back against full marijuana legalization, condemned Trump’s executive order “in the strongest possible terms.”

But the organization’s president, Kevin Sabet, told the Sun-Times, “There’s sort of a glass half full, glass half empty way of looking at it from our perspective.”

“I’m very concerned about the tax breaks that the industry is going to be able to take as a result of it being Schedule III. And I’m very concerned about the message it sends to our young people,” Sabet said.

Around 30,000 licensed health care practitioners are currently allowed to recommend medical marijuana use to more than 6 million patients to treat at least 15 medical conditions, the U.S. Department of Health and Human Services has found.

The federal government has classified marijuana as a Schedule I drug since 1970 when the Controlled Substances Act was signed into law.

The Drug Enforcement Administration defines Schedule I drugs as highly addictive and having no medical use.

In 2022, President Joe Biden asked the HHS and DEA to review marijuana classification. A year later, HHS recommended reclassifying marijuana to Schedule III. Last year, Biden’s administration formally proposed the move.