- The GENIUS Act of 2025 and the Digital Asset Market Structure and Investor Protection Act are moving through Congress.
- Crypto Advisor David Sacks leads the regulation working group, and has already spoken about the classification he would like to see.
- Investors should anticipate changes and prepare ahead of these bills being signed into law.
US lawmakers are finally fast tracking the rules of the road for crypto and digital assets, following years of regulatory confusion and litigation against the industry.
Two key pieces of legislation are currently moving through Congress: the GENIUS Act of 2025, which will regulate payment stablecoins. And the Digital Asset Market Structure And Investor Protection Act, which will classify digital assets into categories and assign them relevant regulatory bodies.
President Trump wants ink dry on both bills by Fall 2025 – or earlier. Investors needn’t wait until then to prepare. AI and Crypto Advisor David Sacks, who leads the working group tackling regulation, has already spoken about what he would like to see reflected in the Market Structure bill. Unsurprisingly, the legislation’s early draft aligns closely with Sacks’s vision.
Digital Asset Classifications that are emerging
Category 1 – Currencies and stablecoins
Example: USDC and RLUSD.
Stablecoins pegged to the US dollar, and used primarily for payments and remittances, have been given regulatory priority.
The Trump administration has said it will promote use of privately issued and compliant stable coins, like Circle’s USDC and Ripple’s RLUSD, and reject the control and manipulation that could arise with a Central Bank Digital Currency (CBDC).
The role of Tether USDT, and its compliance with the new law, remains to be seen. Liquidity leaving USDT in favour of a more compliant competitor is a risk that should be anticipated by the whole industry.
The impact of a regulated US stablecoin will not just stay within US borders. Speaking of the wider opportunity, David Sacks said, “We can basically create a digital dollar that people all over the world will use.”
The US dollar already twins local currency in developing economies like Argentina. A place where economic instability and currency devaluation have been typical. Inflation is now a persistent conversation in the West post-pandemic, and we could see the digital dollar expand amongst consumers there, too. Exponentially increasing the market for stablecoins.
Category 2 – Securities
Example: Binance and BNB.
Crypto securities are digital assets that have features similar to traditional equities. Their token holders have an expectation of profits, benefits, ownership or equity within a blockchain’s ecosystem. This could include coins sold through Initial Coin Offerings (ICOs) or those with DeFi mechanisms that yield profit or dividends.
Binance’s BNB token could be classified this way thanks to Binance’s influence and control over the asset. And the fact that it was offered through ICO in 2017, as part of the Binance exchange launch.
Until now, the US Securities and Exchange Commission (SEC) has taken the position that most digital assets outside Bitcoin and Ethereum are likely securities. They infamously litigated against XRP and Ripple.
XRP was found not to be a security, as it didn’t meet the full legal definition under the Howey Test, which classifies whether a financial product is a security or not. The Digital Asset Market Structure And Investor Protection Act will decide once and for all which tokens are securities and are to be regulated by the SEC.
Investors should brace for a massive perception shift of established projects like BNB, and anticipate increased reporting requirements, and perhaps even accredited investor status to continue buying and/or holding the asset.
Category 3 – Commodities
Example: Bitcoin
This will be the most interesting category to watch, if only to see who else officially lands here next to Bitcoin; an asset already accepted as a digital commodity, both by the Commodity Futures Trading Commission (CFTC) and the market itself.
Projects like Ethereum are subject to ongoing debate about whether they are securities or commodities, because they have features of both. Ethereum had an ICO, but it is also a decentralised utility, powering the network as a hub for dApps. Legal clarity will settle ETH’s fate once and for all. Projects deemed commodities will be regulated by the CFTC, treated as digital property and likely taxed under capital gains structures.
Category 4 – Memes and NFTs
Example: Doge
Regulated meme coins will bring stronger investor protections and legitimacy to this area of digital assets. At the moment, memes are driven by speculation and cultural trends. Newly minted ones are becoming increasingly controversial and volatile. As seen with Argentine president Javier Milei’s endorsement of $LIBRA Coin – it dropped 95% shortly after being endorsed by the South American leader.
While meme coins don’t appear specifically in the legislation as yet, David Sacks has suggested they could be regulated as a form of “collectable”. This would include digital art and Non-Fungible Tokens (NFTs), as well as meme coins. Regulation would provide much-needed rules around an area that has become beset with risk.
A Final Word
As the regulatory framework progresses, staying informed about these classifications will empower investors to navigate the market more effectively. Market structure will provide the industry with much-needed clarity, and embed it into the financial and cultural mainstream for widespread adoption.
