SEC Considers Classifying XRP as a Commodity

The SEC is considering classifying XRP as a commodity during its ongoing settlement talks with Ripple Labs, according to FOX Business senior correspondent Charles Gasparino.

> SCOOP: Off of @EleanorTerrett’s scoop from yesterday on the @Ripple – @SECGov settlement negotiations, one issue being weighed by the commission is whether $XRP continues to trade and have a utility that makes it more a commodity than a security. I am told the…
> — Charles Gasparino (@CGasparino) March 13, 2025

Gasparino indicated that regulators are evaluating whether XRP shares similarities with commodities such as Ethereum. Currently, the SEC views Ethereum as a “pure commodity” despite its initial fundraising through an ICO.

According to the report, Ethereum’s regulatory treatment serves as a key comparison point, as both XRP and ETH were initially utilized to fund blockchain network development.

Ripple clarified that it did not conduct an ICO for XRP. Ripple’s CTO, David Schwartz, and other officials have stated that XRP was pre-mined and distributed differently than traditional ICO models.

Ripple’s distribution method has sparked controversy, as it contrasts with decentralized cryptocurrency launches, leading to scrutiny from regulators like the SEC, which accuses Ripple of selling unregistered securities.

Nevertheless, Ripple achieved a legal victory in 2023, confirming that XRP sales on public exchanges did not breach securities laws.

Neither Ripple nor the SEC has publicly commented on the latest developments in the settlement discussions.

The potential change in the SEC’s position on XRP could lead to its reclassification, impacting Ripple’s ongoing legal conflict with the SEC regarding alleged unregistered securities offerings.

FOX Business journalist Eleanor Terrett reported that the legal battle between the SEC and Ripple is nearing a resolution, with both parties working towards an agreement.

Ripple’s legal team is renegotiating terms related to a ruling that imposed a $125 million fine and restrictions on selling XRP to institutional investors. Terrett noted that discussions are focusing on adjusting terms to align with recent SEC policy shifts under its new leadership.