CLARITY Act Could Classify XRP, HBAR, and XLM as CFTC Commodities

The CLARITY Act — the digital asset market structure bill designed to do for XRP, HBAR, and XLM what the GENIUS Act did for stablecoins — did not pass the Senate floor by July 4, 2026 as some advocates expected, but Senator Bill Hagerty, who authored the GENIUS Act, has publicly signaled his support and expects a revised version to be ready for a vote by the end of July 2026.

The bill cleared the Senate Banking Committee on May 14, 2026, and is now seeking bipartisan floor approval. Polymarket prediction markets place the odds of the CLARITY Act being signed into law in 2026 at approximately 47%, as of July 7. That is not certainty — but nearly coin-flip odds on major financial legislation is a meaningful signal in a market that accurately priced the GENIUS Act timeline.

What the CLARITY Act Would Do

If enacted, the CLARITY Act would reclassify assets like XRP, HBAR, and XLM as digital commodities under the jurisdiction of the Commodity Futures Trading Commission (CFTC) rather than securities under the SEC. This would effectively resolve the regulatory classification ambiguity that has inhibited institutional deployment of these assets in the United States for years.

The practical implication is significant. Assets classified as commodities can be held, custodied, and traded by a broader range of financial institutions without the compliance burden associated with securities products. It would also eliminate the threat of securities enforcement actions for assets that have already deployed substantial real-world infrastructure.

In remarks reported by DailyCoin, Senator Hagerty described the bill's purpose: "It's creating the type of certainty that's necessary to bring the entire digital asset framework into a full-blown opportunity here in America." He drew a direct parallel to the GENIUS Act's effect on stablecoins — the stablecoin market grew from approximately $204 billion to over $311 billion after that legislation passed in July 2025, with daily trading volumes quadrupling from roughly $1 trillion to $4 trillion.

The GENIUS Act Precedent

The GENIUS Act provides the most relevant template for evaluating what CLARITY could mean for DLT infrastructure tokens. Stablecoins had regulatory clarity after July 2025. Their market grew by roughly 52% in aggregate, and trading volumes quadrupled. The capital that had been sitting on the sidelines waiting for a clear legal framework deployed relatively quickly after the bill passed.

If the same pattern holds for XRP, HBAR, and XLM — three assets with substantially more deployed enterprise infrastructure than stablecoins had in 2025 — the capital unlock could be significant. Multiple analysts cited in the DailyCoin report referenced "trillions in institutional capital" waiting on CLARITY Act passage. That framing should be treated as advocacy rather than analysis, but the directional argument is structurally sound: legal clarity reduces institutional risk, and reducing institutional risk increases deployable capital.

Current Status and Timeline

As of July 8, 2026, the bill is in the Senate with bipartisan support being assembled. The sticking points involve stablecoin yield rules and DeFi provisions that remain contentious between Republican and Democratic Senate offices. Senator Hagerty's end-of-July timeline for a revised bill is aspirational — legislative schedules frequently slip. The Polymarket 47% figure accounts for this uncertainty.

Stellar's XLM network has already deployed multiple money-market funds, and Ripple's XRP is active in cross-border payment corridors through its On-Demand Liquidity product. Hedera's HBAR is embedded in enterprise supply chain and financial application infrastructure. These are not speculative assets waiting on regulatory clarity to build their use cases — they are operating networks that would benefit from cleaner U.S. regulatory standing.

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