SEC Reaffirms XRP as Digital Commodity in New Regulatory Guidance

The US Securities and Exchange Commission (SEC) has given XRP a significant regulatory boost. On September 25, the agency's Division of Corporation Finance published a detailed FAQ page addressing the classification of crypto assets under federal securities law.

The document builds on the landmark March Interpretive Release, which classified XRP as a digital commodity alongside Bitcoin and other cryptocurrencies. The SEC has confirmed that activities to maintain, secure, or improve a functional crypto system do not constitute essential managerial efforts under the Howey test.

This matters for XRP because it removes a key argument the SEC previously used to pursue securities enforcement. Rietveld noted that 'the SEC's own framework lists XRP as a digital commodity,' and the FAQ confirms that framework carries formal agency authority.

The September FAQ strengthens the case for institutional participation in XRP, narrowing liability for platforms listing it. This regulatory clarity is crucial for institutions waiting to get more involved with XRP.