The SEC is considering changing XRP’s status from a security to a commodity similar to Ethereum. This could affect U.S. cryptocurrency regulations and potentially increase XRP's market value.
Re-evaluation of XRP’s Status
The SEC v. Ripple case sees new developments as the SEC accuses XRP of being an unregistered security while trying to halt its trading. Recent reports suggest the parties are nearing a settlement, possibly impacting the crypto space broadly. It's reported that the SEC is considering changing XRP’s status from a security to a commodity, similar to Ethereum's transition. If approved, this could influence U.S. crypto regulations, potentially pushing XRP's market value to new heights.
Ripple Aims to Follow Ethereum’s Path
Ripple wants XRP to be classified as a commodity for transactions, not as an investment contract. The SEC also considers past legal cases, including a 2022 lawsuit where Vermont and other US states sued Coinbase for breaching regulations. Vermont recently withdrew the charges, stating the SEC’s new stance on crypto regulations rendered their arguments pointless. One state's admission that prior arguments no longer hold may prompt the SEC to be less stringent with Ripple, reclassifying XRP.
Ripple and SEC Legal Battle
In 2020, the SEC sued Ripple, claiming it illegally sold XRP as an unregistered security—a shock for many, as XRP was the third most popular crypto in late 2017. Ripple defended itself by asserting XRP is not a security but a digital currency. The company controls much of XRP in escrow, releasing it to stabilize the market. However, the SEC argued Ripple improperly influenced XRP's value, required to register it as a security. Both sides are now negotiating a settlement.
The potential shift in XRP's status from a security to a commodity could significantly impact the crypto market and U.S. regulations, possibly boosting XRP's market value and influencing crypto classification.
