Rumors suggest that the SEC may reclassify XRP as a commodity , potentially shifting the regulatory framework surrounding the digital asset. This move is reportedly being considered in light of XRP’s similarities to Ethereum, which was previously reclassified. Such a change could significantly impact Ripple’s ongoing legal battle with the SEC, easing restrictions and improving market confidence. Recently, Vermont regulators dropped their case against Coinbase , citing the SEC’s new Crypto Task Force as a factor in their decision. The lawsuit originally argued that Coinbase’s staking services violated securities laws. However, with the SEC’s evolving approach to crypto regulation, Vermont no longer holds this position. This could set a precedent for Ripple’s case, as shifting regulatory attitudes may influence the Commission’s stance on XRP. The dispute between Ripple and the SEC has been one of the most high-profile legal battles in crypto . Under former SEC Chairman Gary Gensler, the Commission classified XRP as an unregistered security, preventing its sale in the U.S. Recent developments suggest that the SEC might be reconsidering its position, with discussions reportedly underway to negotiate new regulatory terms for XRP. Financial analyst Charles Gasparino noted that one of the key issues under review is whether XRP’s real-world utility makes it more of a commodity than a security. He pointed to Ethereum’s history, where ETH initially launched through an ICO but later transitioned into a decentralized asset. If XRP follows a similar trajectory, it could be reclassified under less restrictive regulations. This reclassification could mark a major shift in U.S. crypto policy. Commissioner Hester Peirce has previously suggested that some digital assets may no longer be considered securities. Additionally, the SEC is reportedly planning deeper collaboration with the Commodity Futures Trading Commission (CFTC), the top U.S. regulator for commodities. If Ripple and the SEC reach an agreement, XRP could be subject to less stringent regulations , potentially leading to a more favorable market environment. A classification as a commodity would allow XRP to operate under clearer legal guidelines, similar to Ethereum, and could pave the way for institutional adoption. The legal case against Ripple has long been centered around whether XRP should be considered an investment contract or a decentralized asset with utility. Ripple has maintained that its network facilitates real-time global transactions, making it more aligned with commodity-like functionality. Vermont’s recent decision to drop its lawsuit against Coinbase also hints at a broader regulatory shift. In its official statement, Vermont’s financial authorities acknowledged that new federal guidelines are emerging. They cited the formation of the SEC’s Crypto Task Force as a sign that updated regulations will soon provide more clarity for digital assets. This move may set a precedent that benefits Ripple. If the SEC follows a similar path, it could determine that past regulatory actions against XRP were too strict. That would allow for a reassessment of its classification, opening the door to broader acceptance. If XRP is officially reclassified as a commodity, the effects could be immediate. Notably, this change could increase the likelihood of XRP ETF approvals , as commodities-based ETFs face fewer regulatory obstacles than securities-based funds. The decision could drive investor confidence and support XRP’s long-term market position. With regulatory attitudes shifting and new frameworks being developed, the next few months will be critical for XRP. If the SEC moves forward with this reclassification, it could signal a turning point for crypto regulation in the U.S. and solidify XRP’s standing as a major digital asset.
