CLARITY Act Finalized: XRP Classified as Commodity Regardless of Ripple Holdings
A finalized version of the CLARITY Act has been released by Senate Republicans, which includes new language on digital assets and their classification. According to attorney Bill Morgan, this clears up a long-standing debate in crypto about whether XRP will be considered a commodity regardless of how much of its supply Ripple holds.
The final 635-page draft reflects changes made in response to Democrats' requests, including stricter ethics provisions for federal officials and state attorneys general. Officials would need to either divest significant digital asset holdings or place them into a qualified blind trust.
Morgan's statement was directed at critics who argued that Ripple's large XRP holdings should disqualify the token from commodity status. The new draft also includes a 'circuit breaker' mechanism giving federal regulators authority to intervene on stablecoin yields if community banks experience significant deposit flight into stablecoins.