Could a future US government reverse XRP's regulatory position?

The full answer

XRP’s US position has three layers: a court judgment, an SEC and CFTC interpretation, and agency letters and executive direction. This page sorts which layer a later government could change on its own. It draws on public sources dated up to September 23, 2026.

Which parts of XRP’s position rest on a final judgment and which on revocable policy?

The judgment. The SEC sued Ripple in the Southern District of New York on December 22, 2020 [2]. PYMNTS reported on August 7, 2025 that the judge ruled in 2023 that Ripple’s sales of XRP on public exchanges did not meet the legal definition of a security, while its sales to institutional investors should have complied with securities laws [1]. The SEC says the court entered a final judgment on August 7, 2024 with a $125,035,150 civil penalty and an injunction against Ripple [2]. After both sides dismissed their cross-appeals, the SEC said the final judgment imposing the $125 million fine and the injunction against violating the registration provisions of the Securities Act of 1933 would remain in effect, PYMNTS reported on August 7, 2025 [1]. The page Is the SEC vs Ripple case over, and who won? covers that outcome in detail.

The interpretation. XRP’s label as a “digital commodity” comes from SEC and CFTC Release 33-11412, dated March 17, 2026 and effective March 23, 2026, which lists XRP among its examples and says digital commodities are not themselves securities [3]. The release says it conveys the Commission’s views [3]. The Commission says its conclusion that each listed asset is a digital commodity is based on its understanding of the asset’s characteristics, terms and functions as of the date of the release [3]. The release calls itself the Commission’s “first step” toward a clearer regulatory framework, and the SEC solicits comment on it [3]. It states that it does not supersede or replace the Howey test, which it calls binding legal precedent [3]. The SEC says it will administer the securities laws consistently with the interpretation, including in enforcement actions, and the CFTC says it will administer the Commodity Exchange Act consistently with it [3]. The release says that, based on its understanding of their characteristics, terms and functions as of the release date, each listed asset is a digital commodity; it notes that as of that date each underlies a futures contract, and that underlying such a contract is not necessary to be a digital commodity [3].

The policy layer. FinTech Weekly wrote on September 23, 2026 that the SEC and CFTC are expected to keep moving through exemptions, no-action relief and rulemaking, tools it described as faster than legislation but able to be reversed by the next administration [4].

The judgment is the layer a later administration cannot rewrite by itself. The interpretation and the letters described below sit in the layer that agencies control. CFTC no-action letter 25-40, dated December 8, 2025, is a staff no-action position with conditions; for Regulation 30.7 customer accounts it covers digital assets that are the underlying commodity of a futures contract listed on a CFTC-registered designated contract market [7]. CFTC Letter No. 25-40, a no-action letter dated December 8, 2025, makes its no-action position subject to conditions, including one on which digital assets may be held as collateral in 30.7 customer accounts [7].

It covers a digital asset accepted as collateral or for settlement by a registered derivatives clearing organization, or by a foreign clearing organization in a jurisdiction that has implemented the Recommendations for Central Counterparties. It also covers a digital asset that is a payment stablecoin or the underlying commodity of a futures contract listed on a CFTC-registered designated contract market [7].

25-40, the FCM covered by the letter accepts only digital assets in the form of payment stablecoins, Bitcoin, and Ether as margin collateral from customers [7].

On September 17, 2025 the SEC approved generic listing standards, so exchanges may list Commodity-Based Trust Shares that meet them without a separate Section 19(b) rule filing [8].

Is the CLARITY Act dead, or only stalled?

The House passed the CLARITY Act on July 17, 2025 by 294 to 134, according to the Latham & Watkins policy tracker [5]. The Senate Banking Committee advanced its version 15 to 9 on May 14, 2026. Latham reported that the two Democrats who voted yes said their votes did not guarantee floor support without progress on an ethics provision covering government officials’ ties to the crypto industry [5]. The tracker said the bill still had to be reconciled with the Senate Agriculture Committee’s version, pass a 60-vote Senate floor vote, be reconciled with the House version and be signed by the President [5]. Latham & Watkins’ US crypto policy tracker said the Senate delayed a floor vote ahead of the August 2026 recess and scheduled a procedural vote for September 15, 2026, a cloture vote on the motion to proceed.

That motion failed 49 to 50 on September 15, 2026, short of the 60 votes required, FinTech Weekly reported on September 23, 2026 [4]. FinTech Weekly said ethics provisions, not the split between the SEC and CFTC, sank it [4]. Ripple wrote on September 15, 2026 that the bill “failed to advance in the Senate after a critical vote” [6].

Senator Thom Tillis entered a motion to reconsider, which FinTech Weekly said keeps the procedural door open [4]. Two days after the vote, seven Democratic senators who had worked on the text called the result “a setback, but not the end”, the same report said [4]. FinTech Weekly put the Senate’s next work period at 5 October to November 6, 2026, called a lame-duck session after the election the most plausible window, and said on September 23, 2026 that prediction markets priced passage this year in the single digits [4]. As of October 1, 2026 the project’s sources report no new vote. The page What happened to the CLARITY Act, and does it affect XRP? follows the bill itself.

Have past administrations reversed crypto guidance before, and how fast?

The public record shows one change of course in this area, in this case. PYMNTS reported that the SEC filed its lawsuit in December 2020, alleging that Ripple conducted a $1.3 billion unregistered securities offering [1]. On May 8, 2025 the SEC said it and Ripple would ask the court to dissolve the injunction and release the $125,035,150 penalty held in escrow, with $50 million paid to the SEC and the rest to Ripple [2]. The SEC said that decision rested on its “ongoing efforts to reform and renew its regulatory approach to the crypto industry, not on any assessment of the merits” [2]. It added that resolving the case “does not necessarily reflect the Commission’s position on any other case” [2].

The court did not accept the change. The parties had asked the judge to set aside the injunction and lower the $125 million fine she imposed in August 2024 to $50 million, and the judge rejected the joint motion, PYMNTS reported on August 7, 2025 [1].

From the December 2020 filing to the May 2025 settlement, the SEC’s stance on Ripple shifted within about four years and five months, through agency discretion. The judgment did not move with it. I could not find other cases of US agencies withdrawing crypto guidance, so I can give no general rate of reversal, as of October 1, 2026.

Would a reversal affect XRP bought on exchanges or only Ripple’s sales?

The 2023 ruling addressed Ripple’s own sales, splitting public-exchange sales from sales to institutional investors, PYMNTS reported [1]. The page Why were XRP sales to institutions treated differently? explains that split. Release 33-11412 classifies the asset: it says a non-security crypto asset can be offered and sold subject to an investment contract, which is a security, and does not necessarily remain subject to that contract forever [3].

A revision of the release is the change most likely to reach XRP held by people who bought it on exchanges, because the release speaks about the asset, while the 2023 ruling described Ripple’s past sales. Whether the 2023 ruling carries weight beyond this case is a separate question, covered in Does the Ripple ruling bind other courts or settle the status of other tokens?.

What else rests on agency letters and executive direction?

CFTC staff Letter 25-40, a no-action letter dated December 8, 2025, covers the use of digital assets as customer margin collateral by futures commission merchants [7]. The letter states that it represents “the view of the Division only” and that “the Division retains the authority to condition further, modify, suspend, terminate” its position [7].

On September 17, 2025 the SEC approved generic listing standards for exchange-traded products holding spot commodities, including digital assets, so exchanges may list qualifying products without first filing a proposed rule change under Section 19(b) [8]. This is a commission approval rather than a statute, so it sits in the same agency layer FinTech Weekly describes as reversible [4].

How US banking agencies will treat crypto capital is not established in the sources reviewed. How those capital rules apply to XRP is on What rules govern lending against XRP, and how do bank capital rules treat it?, and the executive actions themselves are on What has the Trump administration’s crypto policy actually done?.

The one enacted federal law in this area is narrower. Latham describes the GENIUS Act, signed on July 18, 2025, as the first US federal legislation on digital assets and says it establishes a framework for payment stablecoins [5]. A US reversal would not change rules elsewhere; those are compared on How is XRP classified and regulated outside the US?.

The Industry Spread reported that the US administration rejected that standard through Executive Order 14178 and a July 2025 report, directed banking agencies to develop a risk-based framework, and that the Federal Reserve, OCC and FDIC are expected to propose a risk-based alternative [9].

What is the strongest case that the position will hold?

Ripple’s case is that the court layer carries the weight. Ripple wrote on September 15, 2026 that “Ripple and XRP stand on settled ground” and that the Senate vote “does not change the established legal clarity for XRP” [6]. Ripple says that in 2023 it “secured a landmark victory establishing that XRP is not a security” [6]; PYMNTS describes the same ruling as being about Ripple’s sales, split by type of buyer [1]. Ripple says attention will shift toward SEC and CFTC rulemaking and that it is confident “XRP’s status as a digital commodity will not change as that rulemaking proceeds” [6].

Ripple also wrote that the US market operates “without a durable statutory framework that the Clarity Act could have provided” and that responsible businesses “should not have to rely on years of litigation – or live under the threat of one” [6]. The 2025 settlement attempt shows the court held its judgment in place against a change in agency policy [1]. The case against relying on agency positions is set out in the FinTech Weekly assessment above [4], and the broader question is argued on Is XRP a security?.

Ripple itself wrote that businesses “should not have to rely on years of litigation” to learn how the law applies [6].