CFTC Commissioner: Ripple’s Legal Victory Marks the Beginning of Regulatory Clarity in the US

Caroline Pham, one of the commissioners of the Commodities Futures Trading Commission (CFTC), expressed her belief that the recent partial victory by Ripple in court sets the stage for regulatory clarity in the United States crypto space. In an interview on Bloomberg TV, Pham stated that significant court decisions on the classification of crypto assets have paved the way for regulatory certainty.

Pham previously predicted that regulatory clarity would emerge through court rulings, particularly concerning the definition of securities. She remarked, “We’ve seen that with some very big court opinions that have been released.”

Looking ahead, Pham expressed her anticipation to participate in regulatory working groups and emphasized the importance of collaboration among various US regulators, including the Securities and Exchange Commission (SEC), to develop a comprehensive approach to crypto regulation.

Pham’s remarks followed the recent key partial victory of San Francisco-based fintech firm Ripple in an ongoing legal battle with the SEC. The court ruling by Judge Analisa Torres stated that XRP was not a security when sold to retail investors on digital asset exchanges.

While SEC Chair Gary Gensler expressed disappointment with the ruling, he remains committed to enforcement actions in the crypto space. Gensler has previously suggested that, apart from Bitcoin, most digital assets are securities, though the SEC has not made a definitive statement to that effect.

Commissioner Pham also highlighted the potential of real-world asset (RWA) tokenization, emphasizing the opportunities for modernizing financial markets by tokenizing money market funds on the blockchain. As traditional finance companies increasingly engage with real-world asset protocols, several RWAs have outperformed decentralized finance (DeFi) assets in recent times.

With the Ripple case outcome and ongoing discussions among regulators, the US crypto industry may witness a gradual progression towards regulatory clarity, enabling further innovation and development in the market.

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