The Senate Banking Committee just dropped a draft bill Tuesday that could fundamentally change how regulators treat most major cryptocurrencies. If this thing passes, XRP (XRP), Solana (SOL), Dogecoin (DOGE), and several others would get the same regulatory treatment as Bitcoin (BTC)—which means they'd be commodities, not securities.
That's a bigger deal than it sounds, because the difference between those two classifications has kept billions of dollars in crypto investment products stuck in approval purgatory.
The ETF Shortcut to Commodity Status
Here's how the bill works: tokens qualify as "non-ancillary assets" if they served as the principal asset of an ETF listed on a national securities exchange as of January 1. Once a token hits that threshold, it escapes SEC securities rules and doesn't need to file the same disclosures that other crypto projects do.
Essentially, every altcoin ETF that launched before New Year's Day just gave those tokens a regulatory hall pass. XRP, SOL, DOGE, Litecoin (LTC), Hedera (HBAR), and Chainlink (LINK) all qualify based on ETFs already trading on major exchanges.
Defining What Actually Counts as a Commodity
Bitcoin has always been treated as a commodity like gold, regulated by the CFTC. Most altcoins, though, have lived in regulatory limbo, with the SEC suggesting they might be securities requiring registration.
This bill creates a formal definition of "network tokens"—digital assets tied to blockchain networks that don't give holders ownership rights, profit shares, or voting control over a company. If a token fits that definition and powers a sufficiently decentralized network, it's a commodity.
The SEC would set standards for measuring decentralization. Once a network passes that test, secondary market trading no longer triggers securities laws, even if the original token sale looked like an investment contract.
Why Asset Managers Have Been Stuck in Neutral
Asset managers have filed applications for XRP ETFs, Solana ETFs, and other altcoin products, but they couldn't get approval because regulators wouldn't confirm whether those tokens are commodities or securities. This bill solves that problem by making ETF eligibility itself the proof that a token deserves commodity treatment.
The bill also protects exchanges and market makers from inheriting regulatory risk just because they handle tokens. Buying XRP on Coinbase wouldn't be treated as a securities transaction, even if Ripple's original XRP sales decades ago were.
DeFi Protections and the Stablecoin Yield Ban
The draft includes two ethics provisions covering felony conviction rules and insider trading language. Fox Business reporter Eleanor Terrett noted these are the only ethics provisions the Banking Committee can include—other ethics rules fall under different committees.
Section 601 protects software developers who build DeFi protocols. This came after DeFi companies and traditional banks reached a compromise this week following heated negotiations, as banks were worried crypto protocols could be used as loopholes to avoid financial regulations.
The bill also bans crypto companies from paying interest on stablecoins. This is a major win for traditional banks, who didn't want stablecoin issuers like Tether or Circle competing by offering yield on dollar deposits.
What Happens Next
The Senate Banking Committee marks up the bill Thursday, meaning senators can propose changes before voting. If it passes as written, the regulatory barrier blocking altcoin ETFs disappears.
That doesn't guarantee instant approvals, but asset managers who shelved applications for Solana ETFs or XRP ETFs would have a clear legal path to resubmit.
Jordan Jefferson, Founder of DogeOS, said the immediate impact would be less about prices and more about compliance, as a clearer statutory path widens the set of institutions allowed to engage with these tokens.
