• CFTC Commissioner Caroline Pham believes court opinions around digital assets and securities are a first step to US crypto regulatory clarity.
• Last week, San Francisco-based fintech firm Ripple won a partial victory in an ongoing court battle with the SEC over the classification of XRP.
• Commissioner Pham also highlighted the importance of real-world asset (RWA) tokenization.
CFTC Commissioner Believes Court Decisions Lay Path To Crypto Regulatory Clarity
CFTC Commissioner Caroline Pham says recent court decisions around digital assets and securities are a first step to crypto regulatory clarity in the United States. Pham made these comments on Bloomberg TV on July 17th, following Ripple’s partial victory in an ongoing court battle in which the SEC accused it of selling unregistered securities.
Judge Rules XRP Not A Security When Sold To Retail Investors
Judge Analisa Torres of the Southern District of New York ruled on July 14th that XRP was not a security when sold to retail investors on digital asset exchanges. This ruling was not well received by SEC Chair Gary Gensler, who called it disappointing at a July 17th press conference. Gensler has previously suggested that every digital asset aside from Bitcoin is a security, though his agency has not gone as far as to say the same. Despite this, Gensler has vowed to continue with enforcement actions following the recent Ripple triumph.
Path To US Crypto Regulatory Clarity Laid Out
Commissioner Pham believes that this decision will eventually lead to regulatory clarity for cryptocurrencies in the US and she looks forward to participating in regulatory working groups together with other US regulators such as the Securities and Exchange Commission. According to her, they should come up with a “holistic approach” to crypto regulation.
Real World Asset Tokenization Important As Well
Pham also highlighted the importance of real-world asset (RWA) tokenization stating there were “real opportunities” for institutional markets and central banks alike as they look towards tokenizing real assets like bonds within regulated environments, both domestically and internationally
The recent partial win by Ripple could be seen as an encouraging move towards clearer cryptocurrency regulations in the United States and other countries may follow suit if successful outcomes continue down this path. Additionally, RWA tokenization provides another area where traditional financial institutions can benefit from blockchain technology within regulated spaces domestically or globally.