Ripple: SEC Considers classifying XRP a Commodity
The Securities and Exchange Commission is considering designing XRP as a commodity instead of a security. According to reports, this conversation started during the agency’s ongoing settlement talks with Ripple Labs, which may indicate e a change in the agency’s regulatory approach
Charles Gasparino, a senior Fox Business correspondent, cited insiders who said the SEC is reassessing the usefulness of XRP and market performance to see if it is more in line with commodities like Ethereum
“Whether $XRP continues to trade and have a utility that makes it more of a commodity and not a security is one issue that the commission is weighing,” the reporter wrote.
“I’ve been informed that the Ethereum example is crucial,”. The latter was issued via an initial coin offering (ICO), but the regulatory agency did not take action against it because it changed into a commodity. The federal agency wants to determine whether XRP has undergone a comparable evolution.
The financial watchdog secured a $125 million fine and a permanent injunction that limited institutional XRP sales in a partial victory against the cryptocurrency payments company.
Sources close to the situation, however, assert that Ripple’s legal team is attempting to negotiate better settlement terms, claiming that new regulations warrant a reconsideration of the fines levied against the company.
According to the lawyers, if the SEC’s new leadership intends to reset enforcement policies for crypto companies, then Ripple shouldn’t be penalized for past actions. Earlier, it had been reported that these efforts to modify the settlement terms were the main reason behind the delay in resolving the case.
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