Host of the Good Morning Crypto podcast, Abdullah Nassif, recently sparked a discussion in the crypto community by questioning whether XRP is “finally” recognized as a currency.
This conversation was triggered by Wall Street analyst Linda Jones, who highlighted in a recent podcast that XRP was long considered not to be a security, even before the SEC lawsuit against Ripple Labs.
The context of her statement revolved around the potential for the SEC to appeal the 2023 ruling, which states that XRP is not a security.
Previous Lawsuit Called XRP a Virtual Currency
According to Jones, it was “already determined” years earlier that XRP is not a security but a currency. Nassif shared Jones’ commentary and asked, “Is XRP finally recognized as a currency?”
Notably, Jones pointed to the time when the U.S. Financial Crimes Enforcement Network (FinCEN) took action against Ripple Labs in 2015. FinCEN classified XRP as a “virtual currency.”
Specifically, it described Ripple Labs and XRP II, LLC as entities involved in selling and facilitating transfers of virtual currency, identified as XRP.
This classification was made in the context of anti-money laundering (AML) regulations and compliance with the Bank Secrecy Act (BSA), for which Ripple was penalized.
However, it is essential to note that the term “virtual currency” did not constitute a formal declaration or detailed analysis of XRP’s regulatory classification, such as whether it is a security or otherwise.
The case only emphasized that virtual currency exchangers, such as Ripple, are obligated to launch products that adhere to AML regulations.
XRP Non-Security Status To Remain Unchanged
Jones recalled this historical record to strengthen the legal position of XRP as not being a security, arguing against the prospect of an appeal. She noted that an earlier court case described it as a virtual currency.
While the crypto community continues to speculate on the potential for an appeal of the 2023 ruling, the SEC has already stated that it does not seek to appeal the ruling that XRP, by itself, is not a security.
This was when the regulator filed an interlocutory appeal after Judge Analisa Torres’s judgment in July 2023, though the move was denied.
Now that the Ripple lawsuit has finally ended, speculations have arisen that the SEC could reinitiate the appeal process. However, Ripple’s Chief Legal Officer, Stuart Alderoty, has clearly stated that an SEC appeal cannot change XRP’s inherent non-security status.
Moreover, prominent voices in the crypto community believe that the odds of the SEC winning on appeal are low.
