The classification of XRP has been an engaging topic within the financial and legal spheres. A recent development reignited this discussion, as a popular currency conversion platform, Valutakalkulator, listed XRP alongside established currencies like Bitcoin and Ethereum.
This listing prompted some in the community to reiterate XRP’s status as a currency. Despite some querying its status, community members remained firm, pushing XRP’sas a currency and not a security.
Understanding the distinction between a security and a currency is crucial. Securities represent investment contracts where investors anticipate profits from the efforts of a third party.
Conversely, currencies function as mediums of exchange, facilitating transactions for goods and services. This distinction carries substantial legal weight, impacting regulations, market perception, and potential use cases for XRP.
The U.S. Securities and Exchange Commission (SEC) has a history of pursuing legal action against entities dealing in cryptocurrencies it considers unregistered securities. For instance, the SEC filed charges against cryptocurrency exchanges like Binance and Coinbase, alleging they facilitated transactions involving unregistered securities.
This stance has significant implications for the broader cryptocurrency market, as most digital assets have not undergone any formal registration process with regulatory bodies.
XRP holds a unique position in this debate. It was one of the first cryptocurrencies to face scrutiny from the SEC, leading to a protracted legal battle with Ripple.
The SEC alleged that XRP functions as an unregistered security. However, the court ruled in July 2023 that XRP itself is not a security and non-institutional XRP sales do not constitute securities offerings.
Additionally, reputable government entities around the world have weighed in. The European Corporate Governance Institute cited the court ruling, further bolstering the argument against XRP being a security.
Valutakalkulator listing XRP as a currency is a positive development for the XRP community. It highlights the growing acceptance of XRP as a medium of exchange within the financial services industry.
However, it is crucial to recognize that the platform’s stance does not hold legal weight. The legal battle between Ripple and the SEC is ongoing, and if the court ultimately sides with Ripple, it would be a significant victory for the cryptocurrency industry.
It could pave the way for wider adoption of XRP for cross-border payments, and an ex-Ripple director believes this needs to happen for XRP’s price to increase.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Times Tabloid is not responsible for any financial losses.
Follow us on Twitter, Facebook, Telegram, and Google News
Taipei, Taiwan, 19th June 2024, Chainwire
The cryptocurrency market has recently seen significant declines in several popular meme coins, including Dogecoin,…
Amid a substantial $20 million accumulation, the altcoin market saw notable price increases in Ethereum,…
Shiba Inu (SHIB) has experienced significant volatility in recent weeks. While the broader cryptocurrency market…
As the digital currency horizon expands, unique contenders capture investor interest. KangaMoon and WienerAI bring…
Shytoshi Kusama, the lead developer for the Shiba Inu project, recently sent a message on…