Hoskinson: XRP Faces Security Classification Risk Under CLARITY Act

Cardano's Charles Hoskinson has expressed concerns over the CLARITY Act, arguing it poses serious regulatory risks for digital assets in the US. In a recent livestream, he pointed out four potential attack vectors that could lead to XRP being classified as a security under the bill.

The first vector involves the 60-day review clock, which Hoskinson says can be paused indefinitely if the SEC issues deficiency letters on day 59. The second targets open-source development, with the SEC potentially defining 'common control' to include developers sharing funding sources or contributing to the same code repository within 18 months.

The third vector involves wallet ownership verification, which could be a sticking point for XRP as Ripple currently holds around 33% of its supply. The fourth targets value attribution, with the SEC defining whether an asset's value comes from on-chain utility rather than speculation through rulemaking.