In a significant development for the cryptocurrency ecosystem, Coinbase has officially designated XRP and Shiba Inu as currencies that function as both money and store of value assets. This classification by one of the most prominent cryptocurrency exchanges could greatly impact their acceptance and usability in the broader market, particularly as regulatory clarity continues to be a hot topic of discussion.
Coinbase’s Classification of XRP and Shiba Inu
Prominent crypto exchange Coinbase has brought some clarity to the ongoing debate surrounding the status of various cryptocurrencies by categorizing both XRP (XRP) and Shiba Inu (SHIB) as currencies. According to the official statement from Coinbase, these digital assets are “specifically designed to function as money or store of value.” This recognition is particularly timely amid the ongoing discussions within the XRP community regarding its regulatory status.
Context within the Regulatory Landscape
The conversation around XRP’s classification as a currency has gained momentum in light of recent statements from key figures in the cryptocurrency sector. For instance, Abdullah Nassif from the Good Morning Crypto podcast raised a pertinent question regarding whether XRP is now officially recognized as a currency. This query was partially in response to Wall Street analyst Linda P. Jones, who noted that FinCEN classified XRP as a virtual currency back in 2015, leading to a significant fine imposed on Ripple, the company behind XRP, for violating the Bank Secrecy Act.
Coinbase’s Currency Designation: A Broader Perspective
Interestingly, Coinbase’s classification extends not only to XRP and SHIB but also includes seven other cryptocurrencies viewed as currencies. This list encompasses:
- Bitcoin (BTC)
- Dogecoin (DOGE)
- Bitcoin Cash (BCH)
- Litecoin (LTC)
- Stellar Lumens (XLM)
- Zcash (ZEC)
- Dash (DASH)
In its announcement, Coinbase emphasized that these tokens are designed to embody the core characteristics of money. These characteristics include:
- Medium of exchange
- Acceptability
- Unit of account
- Store of value
- Limited supply
While the inherent volatility of cryptocurrencies raises questions about the store of value feature, there is a prevailing optimism among enthusiasts that this volatility will eventually stabilize, potentially legitimizing them as reliable stores of value.
The Future of Crypto Regulatory Clarity
The murky waters of cryptocurrency regulations continue to evolve, particularly with the U.S. SEC’s efforts to classify most tokens as securities. While SHIB has not been labeled a security by the SEC, XRP faced such classification in the landmark lawsuit against Ripple in 2020. However, a favorable court ruling ultimately clarified that XRP, by itself, is not a security but can be considered as part of an investment contract.
Recent developments indicate that the SEC may have softened its stance regarding its treatment of cryptocurrencies. Acknowledgment in the ongoing Binance lawsuit noted that crypto assets are fundamentally computer codes and are not inherently securities. This acknowledgment could pave the way for a more conducive regulatory environment for cryptocurrencies.
In summary, Coinbase’s recognition of XRP and Shiba Inu provides much-needed validation for these assets, potentially shaping their futures in an environment where regulatory clarity is indispensable for the growth and adoption of cryptocurrencies. As the cryptocurrency market continues to mature, the implications of these classifications could be far-reaching, affecting everything from investor behavior to regulatory policies.
