XRP dropped more than 8% after the US Senate blocked a motion to advance the Digital Asset Market Clarity Act, deepening a broader crypto selloff. Ripple says the token's existing digital-commodity status from a March SEC-CFTC action still stands, while roughly $1.71 billion in cumulative XRP ETF inflows face a test from the post-vote weakness.
XRP fell more than 8% after the Senate blocked a motion to advance a key crypto bill, even though the token's existing US regulatory treatment stayed intact. CryptoSlate data showed the token falling as low as $1.27 before recovering to about $1.29, extending a decline from roughly $1.42 on Sept. 14. The drop coincided with broader weakness across major cryptocurrencies and a wave of leveraged long liquidations.
The 49-50 vote failed to invoke cloture on a motion to proceed to the Digital Asset Market Clarity Act, denying the bill enough support to reach Senate debate. Ripple CEO Brad Garlinghouse said the result "stings", but argued it does not change the company's commercial trajectory, pointing to demand across traditional finance and the digital-asset industry.
Ripple leans on its existing SEC-CFTC treatment
Ripple's confidence rests partly on regulatory ground XRP gained before the vote. Chief Legal Officer Stuart Alderoty pointed to a March action by the SEC and CFTC, under which XRP was among 18 assets identified as digital commodities based on their characteristics, terms and functions. That treatment remains in effect despite the failed Senate vote.
However, the protection is less durable than legislation — the March action interprets laws already on the books and leaves the SEC room to revise its approach. It also preserves transaction-specific analysis under the Howey test, so a digital commodity that isn't itself a security can still be sold as part of an investment contract subject to securities laws. With Congress stalled, Ripple expects SEC Chairman Paul Atkins and CFTC Chairman Mike Selig to take a larger role in shaping crypto rules.
ETF inflows face a test
Institutional demand for XRP-linked products remains substantial despite the selloff. US spot XRP ETFs had attracted about $1.71 billion in cumulative net inflows through Sept. 14, with roughly $1.58 billion in net assets. That placed XRP behind only Bitcoin and ETH among major US single-asset spot crypto ETF categories, and ahead of Solana's roughly $1.37 billion in cumulative inflows.
The next test is whether that demand holds up after the Senate setback and whether the SEC and CFTC can turn their March interpretation into a lasting framework.
Source: CryptoSlate
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