Author: Thejaswini M A Translation: Shen Ouba, Golden Finance

On March 17, the SEC and CFTC finally delivered the regulatory rulebook that the crypto industry has been desperately pleading for since 2013. I should feel relieved about this, and I have been trying to convince myself.

Bitcoin has dropped 44% from its October peak. Ethereum hovers around $2,000, down by half from seven months ago. The total market cap of altcoins has evaporated by $47 billion from its peak. The Fear and Greed Index reports 11. Not 11 in a bad week, but 11 on a scale of 100. At this point, people are no longer arguing about where the bottom is but are starting to sell off everything they have left.

In such a market, on March 17, the SEC and CFTC released a document that finally clarifies what the tokens you hold actually are. Ten years of litigation, hundreds of enforcement actions, billions of dollars in legal fees. Countless companies have packed their bags and moved to Singapore, unwilling to play guessing games with Gensler. And the answer, incidentally, only arrived in the week that Ethereum broke below $1,900.

But the reality is: the token economy is bleeding, while the underlying infrastructure is thriving. The circulation of stablecoins has surpassed $31.6 billion, and the scale of on-chain real-world assets (RWA) has reached $2.65 billion and continues to grow. The momentum is so strong that Morgan Stanley is setting up a crypto trust bank. Meta has abandoned the metaverse but is integrating stablecoins into WhatsApp. The volume of stablecoin transactions handled by Stripe has reached $400 billion. Nasdaq is building a venue for tokenized equity trading. Crypto is becoming the backbone of global finance, and most of the time, it doesn’t even require a speculative token.

Crypto is no longer just a speculative asset class. The regulatory clarity that arrived on March 17 was tailored for the first generation of crypto but has come in the era of the second generation of crypto.

But that doesn’t mean it’s meaningless.

SEC Chair Gary Gensler once said, “We are no longer the all-encompassing Securities and Exchange Commission.” Wasn’t that a bit late to say?

This is the first time that U.S. regulators have established a unified framework for crypto assets. There are five major categories, and every token must fit into one of them. I will provide definitions for you one by one, just as if you were encountering these concepts for the first time.

Digital commodities are the main event, defined as assets whose value arises from the functional operation of a decentralized cryptographic system, layered with supply and demand relations. Their value does not depend on the management of a centralized issuer. If a network is truly decentralized and can operate without a single company supporting it, then the asset is a commodity. Jurisdiction belongs to the CFTC, not the SEC.

A total of 16 mainstream tokens are officially listed as digital commodities, including: Bitcoin, Ethereum, Solana, XRP, Cardano, Avalanche, Polkadot, Chainlink, Dogecoin, Shiba Inu, and others. Dogecoin and Shiba Inu qualify because there are no “pushers” driving the price based on their own efforts. There are no promises, no roadmaps, and no ongoing work from teams that are crucial to the token’s value. This is why they are classified as commodities rather than securities. The core criterion: whether someone promises you returns based on their own work.

Digital securities refer to tokenized stocks, bonds, and government bonds. In short, these assets are securities before being placed on the blockchain and remain securities afterward. The SEC is responsible for regulating these assets. It’s that simple.

Digital collectibles refer to NFTs that are tied to specific items or experiences. Digital tools refer to assets used to access software or services, without expecting investment returns. Stablecoins have their own category under the framework of the GENIUS Act.

Staking, mining, and airdrops have all been clearly legalized. The document explicitly states that obtaining mining rewards, participating in on-chain staking, and receiving digital commodity airdrops are not considered securities transactions. This removes one of the biggest legal risks hanging over PoS networks since the Gensler era. Packaging non-securities tokens has also been permitted.

The 16 named tokens are all underlying infrastructure tokens that have achieved decentralization for years. However, DeFi protocol tokens—JUP, POL, METEOR, and most tokens launched in the past two years—have not been included and clearly do not meet the criteria. “Functional cryptographic systems without centralized control” is a very high bar, and most protocols still in active development do not meet it. The gray area that this definition should have resolved remains a gray area for most assets held by ordinary people.

Value must come from the programmed operation of functional systems, not from someone’s promises. Just this single standard has clarified a ten-year gray area into rules that compliance personnel can truly implement.

But there is a fatal problem

This document does not constitute formal legislation under the Administrative Procedure Act and does not have the binding force of statutory law or formally promulgated regulations.

This sentence is worth reading again. The 68 pages we’ve been waiting for is merely a regulatory interpretation, not law, and not even a regulation. It is simply an agency position statement issued by the current SEC and CFTC chairs, which can be revoked at any time.

This interpretation is binding on the two agencies themselves, but without legislation, future regulatory bodies can amend it. The document itself also reserves the right to refine and expand the scope of its interpretation. A future SEC chair with a different stance can overturn it without Congressional approval. The next government may not even need new laws; a change in leadership will suffice.

Atkins himself is well aware of this. On the day of the release, he stated a call for Congressional legislation to provide clearer and more enduring rules. He positioned this interpretation as a transitional measure, awaiting Congress to pass a comprehensive market structure bill. This bill is the CLARITY Act, which is currently stuck in the Senate.

The CLARITY Act

The House of Representatives passed the bill with 294 votes on July 2025, showing considerable bipartisan support and genuine consensus. The bill then moved to the Senate, where it promptly stalled.

The core issue holding it up is: stablecoin yields. Banking representatives argue that allowing crypto platforms to pay interest on stablecoin balances would lead to deposit outflows—people would withdraw money from savings accounts to exchange for USDC to seek higher yields. Banking lobby groups quickly took action. The Senate Banking Committee canceled the scheduled review of the provisions in January 2026. The bill has seen no progress in the past two months.

On March 20, Senators Thom Tillis and Angela Orsoubrooks confirmed a principled agreement on stablecoin rewards, which has received the support of the White House. The agreement states: passive yields on stablecoins are prohibited; rewards tied to payment and platform usage activities are still allowed. Both sides are dissatisfied, and compromises often arise this way.

However, yield agreements are just one of five things that need to be completed before the CLARITY Act can take effect. The completion timelines for the other four legislative steps coincide with this year’s most critical periods.

• Senate Banking Committee review; and full Senate voting (requires 60 votes).

• Reconciliation with the Agriculture Committee.

• Reconciliation with the House version.

• Presidential signature.

The Banking Committee’s review is scheduled for late April, after the Easter recess. Senator Bernie Moreno warned that if the bill is not submitted for full Senate consideration before May, digital asset legislation may not progress for years to come.

Additionally, the issue of Iran is consuming Senate time, Trump is demanding priority for the voter ID bill, and DeFi-related provisions remain unresolved (Senate Democrats have raised concerns about illegal financial activities), while ethical provisions remain undecided (especially regarding whether officials should be prohibited from personally profiting from crypto assets, given this administration’s crypto holdings, this issue is politically sensitive). Senate Republicans are also discussing the addition of community bank deregulation to the bill as a political trade-off, which brings a whole new set of negotiations.

The House Financial Services Committee recently held a hearing titled “The Future of Tokenization and Securities: Modernizing Capital Markets.” Witnesses included representatives from SIFMA, the Blockchain Association, DTCC, and Nasdaq. Both Nasdaq and the NYSE are building venues for tokenized equity. DTCC controls the current clearing and settlement. Once DTCC acknowledges the efficiency of blockchain, the related debates will basically be settled.

Thus, the current situation has become: infrastructure is being rapidly built on a set of rules that may not exist two years from now. This is the core contradiction facing the industry right now. Companies are making billion-dollar decisions to build custodial systems, tokenization platforms, and staking infrastructure, while all their basis is just a regulatory interpretation that is persuasive but not legally binding.

Which are permanent and which are not

If you hold any of the 16 named tokens—ETH, SOL, XRP, etc. They are officially recognized as digital commodities under current U.S. rules, because the heads of the two regulatory agencies say so. This classification will remain valid as long as the current or succeeding heads endorse it.

If the CLARITY Act passes, it will become law. In the future, no chairperson will be able to circumvent Congress to overturn it. The named assets will receive permanent classification, and the classification system will have binding force.

If the bill fails to pass before May, this classification system will be based solely on the view of one administration. The 16 named assets are temporarily safe, but everything not named remains unsafe. The vast majority of DeFi, most new tokens, and any non-permissioned assets without a clear issuer remain in a gray area that is not clearly covered by the interpretation.

That awaited conclusion is written in pencil.

Someone needs to pick up the pen to formalize this matter. Everything depends on the direction of the Senate in the next six weeks. Can this set of rules hold until it truly takes effect?