Ripple Says XRP Is Not a Security, Recognized as Digital Commodity

Alderoty Says Ripple and XRP Stand on Settled Ground

XRP’s legal and regulatory position remains intact, according to Ripple Chief Legal Officer Stuart Alderoty, who emphasized the asset’s existing status after the Senate failed to advance the CLARITY Act on Sept. 15. The Senate rejected cloture on the motion to proceed to H.R. 3633 in a 49-50 vote, leaving broader crypto market structure legislation unresolved.

The Ripple legal chief stated:

“Don’t forget – Ripple and XRP stand on settled ground. The 2023 federal Court ruling established XRP is not a security.”

The 2023 ruling distinguished XRP itself from certain transactions involving the token, while finding that some institutional XRP sales constituted unregistered investment contracts. Ripple has consistently pointed to that distinction as establishing that XRP itself is not a security under the federal court’s decision.

That position was reinforced in March, when the Securities and Exchange Commission (SEC) issued an interpretation addressing how federal securities laws apply to crypto assets and related transactions. The Commodity Futures Trading Commission (CFTC) joined the interpretation and stated that it would administer the Commodity Exchange Act consistently with the SEC’s framework. The SEC-CFTC interpretation took effect March 23.

XRP’s Digital Commodity Status Moves to Center Stage

The federal agencies’ March interpretation gave Ripple another regulatory reference point beyond the 2023 court ruling. The framework classifies XRP as a digital commodity while preserving the distinction between the token itself and transactions that could qualify as investment contracts under securities law, an issue the SEC has addressed in its broader guidance on when crypto transactions fall under securities laws.

Alderoty stated:

“And in March the SEC and CFTC issued a joint interpretation naming XRP a digital commodity. SEC Chairman Atkins and a CFTC Chairman Selig understand these markets. We expect future rulemaking from both agencies to continue to set out clear rules of the road.”

The Commodity Futures Trading Commission separately described the March action as an interpretation clarifying how federal securities laws apply to certain crypto assets. CFTC Chairman Michael Selig said the interpretation ended a long wait by American builders and entrepreneurs for clear guidance on crypto assets’ legal status. The CFTC’s interpretation of crypto assets accompanied the SEC’s action.

Future SEC and CFTC Rules Become the Next Focus

Future federal rulemaking now forms the next part of Alderoty’s argument. Rather than treating the March interpretation as the end of the process, he expects both agencies to continue developing rules that provide clearer operating standards for digital asset markets.

The SEC’s March framework covers categories including digital commodities, digital collectibles, digital tools, stablecoins, and digital securities. The interpretation applies to certain types of crypto assets and certain transactions involving crypto assets.

Ripple’s position therefore rests on two separate developments: the 2023 federal court ruling and the March SEC-CFTC interpretation. Alderoty is emphasizing those existing legal and regulatory markers after the failed Sept. 15 procedural vote.