The U.S. securities regulator on Monday asked Nasdaq, CBOE and NYSE to fine-tune their applications to list spot ether exchange-traded-funds (ETFs), signaling the agency may be poised to approve the filings, multiple people familiar with the process told Reuters.

Securities and Exchange Commission officials asked the exchanges to submit their revisions by the end of Tuesday, two of those sources said.

While the exchange applications are the first step in a two-step approval process, a green light from the SEC would mark a major, and surprising, win for the cryptocurrency industry, which had been expecting a thumbs-down.

The price of ether jumped as much as 18% Monday and was up another 8.6% at $3,802 late Tuesday morning before retreating slightly to hover at around $3,747 Tuesday afternoon.

The SEC must decide whether to approve applications filed by CBOE to list ether ETFs provided by VanEck and ARK Investments/21Shares by the end of this week. The SEC had not engaged with exchanges and issuers on the filing details, leading industry executives to expect it would reject them.

But in a surprise move, SEC officials on Monday asked Nasdaq, CBOE and NYSE to quickly make updates and changes to the filings, requests which usually precede approval, said the people familiar with the process, who declined to be identified discussing private regulatory matters.

Spokespeople for the SEC, CBOE, Nasdaq, NYSE and 21Shares, which teamed up with ARK Investments on the filing, declined to comment. Spokespeople for ARK did not return a request for comment.

The exchange applications seek SEC approval for a rule change required to list new products, but the issuers still need the agency to approve the ETF registration statements before they can start trading.

Unlike the exchange filings, there is no set time frame in which the SEC has to decide on the registration filings, meaning it could still take several months for ether ETFs to begin trading.

"This could take a minimum of 60 days," said Steven McClurg, head of U.S. asset management for CoinShares, which launched a spot bitcoin ETF in January but has not filed for an ether ETF.

"These applications contain hundreds of pages of disclosures," he said. "I can’t imagine that they could review this in time for a launch by May."

The first issuers filed for the spot ether products after the SEC approved ETFs tied to ether futures in October. But market participants had expected the SEC to reject the ether ETF applications, citing discouraging and one-sided meetings with the regulator.

The SEC, which is led by crypto skeptic Gary Gensler, rejected spot bitcoin ETFs for more than a decade over market manipulation worries but was forced to approve them after Grayscale Investments won a court challenge last year.

Those products have attracted buying interest from a wide array of hedge funds, wealth advisers and retail investors. Within the first week, two of the new bitcoin funds had attracted more than $1 billion in assets. (Reporting by Suzanne McGee and Hannah Lang in New York; Editing by Michelle Price, Chizu Nomiyama and Leslie Adler)