SEC Launches New Draft Legislation for Crypto Asset Regulation, Ripple Appreciates the New Approach

Digital asset regulations are entering a critical phase with the release of the U.S. Securities and Exchange Commission (SEC) comprehensive framework draft. This development marks a significant step in the U.S. government’s efforts to establish clear yet flexible standards for the rapidly evolving cryptocurrency industry.

Digital Market Restructuring Act Draft 2026: A New Framework

The draft, known as the “Digital Market Restructuring Act 2026,” introduces additional regulatory categories never before seen. It classifies certain digital assets as “Digital Value Instruments” for assets that do not fall under traditional securities or commodities categories. This classification is based on the presence of at least three of five specific characteristics: free transferability, passive income generation ability, limited contractual rights, dependence on specific entities, or lack of internal disciplinary mechanisms.

It is important to note that this draft is still in development and has not yet received formal approval from SEC leadership or the Commodity Futures Trading Commission (CFTC). However, the proposal reflects increasingly mature regulatory thinking among federal policymakers.

Industry Response: Support from Ripple and Regulatory Experts

On January 9, Ripple submitted an official response welcoming parts of this regulatory approach. The company emphasized that the term “decentralization” should not be a binding legal standard. More importantly, Ripple argued that ownership of assets with expectations of price appreciation (passive economic interest) should not automatically trigger traditional securities regulation.

Teresa Goody Guillen, a prominent digital asset regulation attorney, took a similar stance in her comments to the SEC. Guillen supports the view that a framework equating passive economic interest with securities law is fundamentally flawed and conflates speculation with genuine investment rights. While Guillen’s position does not represent official SEC policy, her comments indicate a growing consensus among regulatory experts on the need for clearer conceptual distinctions.

Regulatory Coordination: Key SEC-CFTC Meeting

This momentum coincides with a high-level coordination meeting between the SEC and CFTC scheduled for this week. The “regulatory harmonization” event will bring together SEC Chair Paul Atkins and CFTC Chair to discuss joint approaches to digital asset oversight. The meeting was initially planned for Tuesday but was postponed two days due to severe weather conditions affecting the United States.

Long-term Outlook and Innovation

The draft also proposes several progressive provisions, including risk-based shared jurisdiction between the SEC and CFTC, federal preemption to prevent state-level legal fragmentation, and safe harbor provisions designed to promote ongoing innovation. This multifaceted approach indicates that regulators are trying to balance consumer protection with space for innovation.

Previously, the Senate Agriculture Committee postponed markup discussions for a separate crypto market structure bill, partly due to operational disruptions caused by weather conditions. This delay provides stakeholders more time to engage in the legislative process with a more mature perspective supported by the developing framework draft.