The Senators will no doubt protect franchise defenseman Erik Karlsson, but they will then have some choices to make between Cody Ceci, Marc Methot, Mark Borowiecki, Chris Wideman and Fredrik Claesson.
If Phaneuf waives the clause, the Sens wouldn't have to protect the 32-year-old from the Vegas Golden Knights. Teams must submit their protected list by June 17.
The three-time All-Star had nine goals and 21 assists last season.
The Senators acquired him from the Toronto Maple Leafs in February 2016 in an eight-player deal. Phaneuf has four years left on his contract with a cap hit of $7 million per season.