The U.S. Securities and Exchange Commission (SEC) has approved a rule change on Nasdaq that applies to investment products involving cryptocurrencies. Under the order, Bitcoin, Ethereum, Solana, and XRP were designated as digital commodities that meet the exchange's current eligibility requirements.

The approval relates to Nasdaq Texas, a Nasdaq-affiliated exchange. By classifying these assets as digital commodities, the SEC order allows investment products tied to them to proceed under the exchange's existing listing framework, rather than requiring them to satisfy the standards applied to securities.

The designation marks a notable step in the ongoing regulatory clarification of digital assets in the United States. Whether a cryptocurrency is treated as a security or a commodity determines which regulatory framework applies: securities fall under the SEC's oversight, while commodities are generally regulated by the Commodity Futures Trading Commission (CFTC). Bitcoin and Ether have widely been treated as commodities in prior U.S. regulatory practice, and this order extends that treatment to Solana and XRP within the context of the Nasdaq Texas eligibility framework.

The inclusion of XRP and Solana carries particular weight given their contested history. The SEC sued Ripple in 2020, alleging that XRP sales constituted unregistered securities offerings, and in 2023 SEC lawsuits against the exchanges Coinbase and Binance named Solana among tokens alleged to be securities. The new order's commodity designation for both assets at the exchange level contrasts with those earlier enforcement positions.

The SEC approved spot Bitcoin exchange-traded funds (ETFs) in January 2024, and spot Ether ETFs followed later that year, reflecting a broader shift toward regulated crypto investment vehicles. The new Nasdaq Texas rule change builds on that trend by formalizing the digital-commodity classification for the four named assets at the exchange level. Issuers have also filed for spot ETFs tied to Solana and XRP, and the commodity classification at the exchange level is a factor market participants are watching as those applications proceed.

The order does not apply to all cryptocurrencies; it covers only Bitcoin, Ethereum, Solana, and XRP, the four assets explicitly named in the filing. Whether other exchanges adopt similar classifications for a broader set of assets remains an open question.

Source: coingape.com