Clarity Act Will Treat XRP Like Bitcoin and Ethereum for Legal Status

TLDR

• The U.S. Digital Asset Market Clarity Act could place XRP in the same legal category as Bitcoin and Ethereum by 2026.
• The bill introduces a new “network token” category for assets backed by exchange-traded products (ETPs) listed in the U.S.
• XRP meets the criteria for this new category, as it already underpins multiple ETPs approved in the U.S.
• If passed, the Clarity Act would exempt XRP from additional securities disclosure requirements, treating it as a non-security.
• The Senate Agriculture Committee has postponed its markup of the crypto market structure legislation, affecting the bill’s timeline.

The U.S. Digital Asset Market Clarity Act is poised to elevate XRP to the same legal status as Bitcoin and Ethereum. A provision in the draft bill seeks to categorize certain digital assets as non-securities, depending on their backing by exchange-traded products (ETPs). If the bill passes, XRP will benefit from this provision, potentially eliminating additional regulatory requirements.

XRP’s Inclusion in the “Network Token” Category

Under the Clarity Act, the bill introduces a new term: “network tokens.” This label applies to digital assets linked to an ETP listed on a U.S. exchange by January 1, 2026. If an asset meets this requirement, it will be treated as a non-security, exempt from extra disclosure mandates.

XRP, which already supports multiple ETPs approved in the U.S., meets this criterion. As a result, once the bill becomes law, XRP will fall into the network token category. This development would place XRP in the same legal category as Bitcoin and Ethereum, two assets recognized as commodities by regulators.

The proposal reflects a shift toward a market-driven regulatory approach. Instead of assessing factors like decentralization or issuer control, the bill uses existing financial structures to determine which tokens qualify as non-securities. For XRP, this means it would not face the same scrutiny as traditional securities.

This shift marks a pivotal moment for XRP, which has faced regulatory challenges since the SEC’s 2020 lawsuit. That case accused Ripple, the company behind XRP, of selling unregistered securities. In 2023, a federal court ruled that XRP was not inherently a security. Now, with the Clarity Act, XRP could achieve legal recognition on par with Bitcoin and Ethereum, aligning with broader market trends.

Senate Committee Postpones Legislation Markup

The Senate Agriculture Committee, which was set to mark up crypto market structure legislation, has delayed its plans. Committee Chairman John Boozman confirmed that the markup would occur in the last week of January. The delay is to ensure bipartisan support and avoid overlap with the Senate Banking Committee’s markup scheduled for this Thursday.

The postponed hearing adds another layer of uncertainty to the timing of the bill’s potential passage. However, XRP’s position under the Clarity Act remains secure, given the current market infrastructure surrounding exchange-traded products. With a legal framework likely in place by 2026, XRP will be positioned alongside other established cryptocurrencies like Bitcoin and Ethereum.

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