The U.S. Senate recently added a new provision to its Crypto Assets bill aimed at preventing tokenized stocks from being labeled as "commodities." This change is intended to close potential regulatory loopholes that could limit compliance by crypto companies with legal requirements.

This update appears in the draft of the "2025 Responsible Financial Innovation Act," which aims to draw a line. Stocks tokenized through blockchain will not be able to slip through the loopholes of commodity regulation. This update did not come out of nowhere; Wyoming Republican Senator Cynthia Lummis revealed the day before that the Senate hopes to finalize the bill as soon as possible. "We hope to get this bill to the president's desk by the end of the year," she said.

This means that former President Donald Trump, who has returned to the White House, signed the stablecoin bill in July. During the summer, both the House of Representatives and the Senate cleared that bill. For crypto companies like Coinbase and Ripple, this new bill is an important duel in distinguishing between what constitutes a security and what does not.

The House of Representatives passed its own version of the market structure bill back in July, while the Senate is still working on its version. Once both versions are completed, they need to be reconciled before being sent to Trump's desk, at which point disagreements will arise.

Currently, Cynthia stated that the Senate Banking Committee plans to vote on parts of the bill related to the Securities and Exchange Commission later this month. Meanwhile, the Senate Agriculture Committee, which oversees the Commodity Futures Trading Commission, plans to vote in October. A full vote may take place in November, which Cynthia confirmed.

Democratic members of the Senate have not yet signed in support, but Cynthia stated that dialogue is ongoing. "Efforts have already been made to pair Democrats and Republicans on certain legislative branch issues to ensure maximum substantive bipartisan agreement on key issues," she said.

Even if every Republican senator supports the bill, at least seven Democratic senators need to join in order for it to pass. According to CNBC, a spokesperson for the Senate Banking Committee stated that the current version of the bill "reflects feedback from hundreds of stakeholders on a wide range of issues."

These feedbacks helped delineate the regulatory boundaries between securities and commodities, especially regarding on-chain asset transfers. As the Senate attempts to define these boundaries, Nasdaq-listed crypto company Galaxy Digital has been working to test them. On Wednesday, Galaxy announced that its SEC-registered GLXY stock can now be tokenized directly on the public blockchain through the Opening Bell platform created by crypto startup Superstate.

Galaxy stated that shareholders can now tokenize their equity and transfer it to certified wallets after passing KYC (Know Your Customer) verification. These tokenized stocks can also be traded on DeFi platforms using automated market makers, adding more liquidity and flexibility. Superstate claims that these are not synthetic or wrapped tokens, but equity issued directly on the chain.

The Opening Bell platform was launched back in May and started supporting Solana. It claims to be the first platform that offers SEC-registered public stock directly on blockchain infrastructure without intermediaries or tokenization. Mike Novogratz, the founder and CEO of Galaxy, stated that the goal is to bring effective elements of Crypto Assets into traditional markets. In his words:

"We are proud to partner with Superstate to help lay the groundwork for an on-chain capital market that combines traditional stocks with next-generation infrastructure. Our goal is to create a tokenized equity that brings the best features of transparency, programmability, and composability found in crypto assets into the traditional world. We are involved in building a scalable model that is not only beneficial to Galaxy but to the broader market as well."

Last month, Galaxy announced that it had begun collaborating with Superstate to explore the tokenization of its GLXY stock, and this effort is now live.