Cryptocurrency Market Structure Bill to End Ripple vs. SEC Lawsuit... "If Passed, It Will Break $10"

▲ Ripple (XRP) vs SEC/ChatGPT Generated Image

As the U.S. cryptocurrency market structure bill enters full-fledged legislative procedures, it has emerged as a key variable that could change the direction of the long-standing lawsuit between Ripple and regulators. The market views this bill as a turning point that will eliminate regulatory uncertainty and redefine the classification criteria for virtual assets.

According to CoinGeek, a cryptocurrency specialized media outlet, on April 17 local time, the U.S. cryptocurrency market structure bill, proposed by U.S. Representative John Rose, focuses on codifying the criteria for determining whether virtual assets are securities. This raises the possibility of directly impacting the legal debate surrounding XRP. Ripple has been in a lawsuit with the U.S. Securities and Exchange Commission for years, and if the bill passes, the direction of legal interpretation itself could change. The bill includes provisions to exclude digital assets that meet certain conditions from the application of securities law.

The bill proposes a structure that clearly distinguishes between investment contracts and digital assets. It has been pointed out that the existing Howey Test, designed based on traditional financial environments, does not adequately reflect the characteristics of digital assets. Representative Rose stated that regulatory overlap and interpretive confusion, which hinder the growth of the virtual asset industry, must be eliminated. The bill focuses on limiting the scope of federal securities law application and presenting separate criteria for digital assets. If these criteria are applied, the likelihood of XRP being classified as a digital asset rather than a security increases.

XRP holders are closely watching the impact of this bill on the outcome of the lawsuit. If the legislation is completed and reflected in legal interpretation, a favorable environment for Ripple could be created. The bill is considering excluding assets circulated on decentralized networks, beyond the control of the issuer, from the securities category. If the XRP Ledger's high level of decentralization is recognized, there is a possibility that regulatory burdens could be significantly alleviated.

This legislation is expected to impact the entire virtual asset market, beyond specific projects. With the inclusion of standards for stablecoins and custodial services, the environment for institutional investor entry is expected to improve. There is also a possibility of changes in the trend of companies that chose to move overseas due to the lack of a clear regulatory framework. A bipartisan consensus is forming in political circles, accelerating legislative discussions.

Depending on the progress of the legislation and its detailed provisions, we have entered a phase where the legal status of virtual assets and market capital flows are simultaneously being restructured. If regulatory standards become clear, the inflow of institutional funds and industry restructuring will intertwine, leading to a structural change in the overall market valuation system.

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