US Regulators Unveil New Crypto Asset Classification System

The US financial regulatory agencies, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), have issued joint guidance on cryptocurrency asset regulation.

The new framework categorizes digital assets into five distinct groups: digital commodities, digital collectibles, digital tools, stablecoins, and digital securities. This classification system is expected to provide clarity for the industry and reduce regulatory uncertainty.

According to the guidelines, 16 assets have been specifically designated as digital commodities, including Ethereum, XRP, Solana, Cardano, Chainlink, Bitcoin, and Dogecoin. These designations aim to remove the lingering threat of being classified as unregistered securities for these assets.

The new guidelines also clarify that staking native tokens on chains like Ethereum and Solana is considered an 'administrative' action rather than a securities transaction. This change will allow financial institutions to generate yield from staking, subject to certain limits.