SEC makes huge U-turn, declares crypto tokens are ‘digital commodities’ after years of legal battles

The SEC has made a major shift in its approach to crypto regulation, declaring several prominent tokens – including Ethereum, Solana, and XRP – as “digital commodities.” This move, coupled with a new coordination framework with the CFTC, aims to replace years of enforcement-based regulation with a clearer distinction between assets, contracts, and regulatory jurisdictions. The SEC acknowledges past failures to create a tailored crypto framework and now clarifies that certain crypto activities, like staking and airdrops, may not always be considered securities transactions. Importantly, the agency states that a token can cease to be considered a security once the issuer fulfills its initial promises. While fraud liability and registration requirements remain, this interpretation provides much-needed clarity for exchanges, issuers, and users, potentially reducing legal costs and encouraging more activity within the US. The SEC has also categorized digital assets into commodities, collectibles, tools, and tokenized securities, offering a more structured approach to regulation. This shift is seen as a move towards aligning US crypto regulation with other major jurisdictions like the EU and UK.

(Source：CryptoSlate)