SEC considers classifying XRP as commodity in settlement talks with Ripple

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

SCOOP: Off of @EleanorTerrett's scoop from yesterday on the @Ripple – @SECGov settlement negotiations, one issue that is being weighed by the commission is whether $XRP continues to trade and have a utility that makes it more a commodity and not a security. I am told the…

— Charles Gasparino (@CGasparino) March 13, 2025

Gasparino said that securities regulators are evaluating whether XRP shares characteristics with commodities like Ethereum, which the SEC currently views as a “pure commodity” despite its initial fundraising through an Initial Coin Offering (ICO).

According to the reporter, Ethereums regulatory treatment has emerged as a key comparison point, as both XRP and ETH were initially used to fund blockchain network development.

Ripple previously clarified that it did not conduct an ICO for XRP. Ripples CTO, David Schwartz, and other officials insisted that XRP was pre-mined and distributed differently from typical ICO models.

Ripples distribution model has been a point of contention, as it differs from decentralized cryptocurrency launches and has drawn scrutiny from regulators like the SEC, which accuses Ripple of selling unregistered securities.

However, Ripples legal victory in 2023 clarified that XRP sales on public exchanges did not violate securities laws.

Neither Ripple nor the SEC has provided public comments on the latest developments in the settlement discussions.

The potential shift in the SEC‘s stance on XRP, which could lead too a reclassification of XRP, may affect Ripple’s ongoing legal battle with the SEC over alleged unregistered securities offerings.

FOX Business journalist Eleanor Terrett reported Wednesday that the legal battle between the SEC and Ripple is nearing a conclusion, as the two parties are working toward a resolution.

Ripples legal team is reportedly negotiating adjustments to the ruling, which imposed a $125 million fine and restrictions on selling XRP to institutional investors.

Terrett said that ongoing discussions focus on adapting the terms to reflect recent shifts in SEC policies under its new leadership.