Ripple’s Chief Technology Officer indicates a shift in the regulatory landscape in the United States.

A judicial decision that exonerated Ripple’s XRP token from being classified as a security offering may indicate a shift in the regulatory landscape concerning the cryptocurrency sector in the United States, as well as ongoing lawsuits involving entities such as Coinbase and Binance.US, along with pending ETF applications.

In an exclusive interview with Cointelegraph during the company’s annual Apex developer conference taking place in Amsterdam, Netherlands, Ripple CTO David Schwartz shared insights on the potential precedent established by a federal judge’s ruling that XRP was not a security when sold programmatically on cryptocurrency exchanges.

Ripple has been engaged in a lengthy legal dispute with the U.S. Securities and Exchange Commission since 2020, but its recent partial victory could have favorable repercussions for several crypto-related lawsuits initiated by the SEC.

Schwartz acknowledged that the SEC case had resulted in Ripple losing business opportunities that were available, but emphasized that the more significant impact was felt within the community, as ecosystem support appeared to be hindered by the delisting of XRP from various major exchanges. This situation has since improved with the recent ruling favoring XRP:

“The ruling that we've had so far was sufficient to allow exchanges to relist XRP, and it was big, I think, for the entire ecosystem.”

Schwartz noted that the situation might be changing in the United States, where participants in the crypto ecosystem began contemplating moving to other jurisdictions to operate free from a backdrop of regulatory ambiguity:

“I feel bad that I have to tell people that the United States is probably not where they want to be, but the tide is turning. You know, the ruling in our suit that basically said that XRP is not inherently a security, that’s huge.”

Schwartz remarked that the broader industry is now experiencing the scrutiny that Ripple initially faced from the SEC in 2020, with major cryptocurrency blockchains such as Solana, Cardano, and Polygon having their respective tokens categorized alongside others as unregistered securities in the SEC’s lawsuits against Coinbase earlier in 2023.

“They (SEC) can apply these very same arguments to whatever cryptocurrency you like or whatever business you like. Fortunately, people understand that argument a lot better now that they've seen the SEC go after Coinbase and others and some of the things they've done.”

The Ripple CTO also believes that U.S. judges are increasingly scrutinizing cases presented by the SEC and that companies with adequate resources are taking a stand that will benefit the broader industry.

“They're starting to get huge pushback from Coinbase and pushback on the ETFs. Hopefully that will prompt some changes at the legislature level, hopefully positive ones.”

Ripple's Apex conference gathers developers working within the XRP Ledger blockchain ecosystem. This blockchain serves as the foundation of RippleNet, the platform that oversees Ripple's XRP payments system.

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