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- The IMF’s new crypto framework reignites debate over XRP’s classification as a utility token or security.
- Ripple’s launch of RLUSD adds pressure as global regulators assess the status of XRP under new IMF guidelines.
- Ripple CTO David Schwartz questions the IMF’s criteria, challenging its relevance to major cryptocurrencies.
The International Monetary Fund established a new global method to categorize digital assets, providing classification standards to undefined digital assets of previous years. The IMF declares that Bitcoin and other unbacked tokens belong to the capital assets category, yet stablecoins that depend on financial liabilities are classified as financial instruments.
The IMF has classified cryptocurrency activities between borders as capital account transactions that involve non-derivative asset purchases or sales. Foreign investors’ possession of Ethereum and Solana tokens classifies these protocol and platform tokens as assets resembling equity. Utility tokens have become the main topic for debate regarding their classification status.
The XRP community sparked fresh debates after the IMF declared utility tokens as financial instruments involving claims for identified counterparties. In a public statement, David Schwartz, who serves as Ripple’s chief technology officer, addressed these claim points directly. He says very few digital assets meet the requirements for a utility token defined by the IMF.
Based on this analysis, Schwartz indicates that Bitcoin and Ethereum could function as utility tokens because they facilitate network transaction costs. According to him, the interpretation brings inconsistency to broader digital asset landscape, which could confuse. Schwartz made these remarks while Ripple prepared to introduce RLUSD during its stablecoin market expansion.
Ripple’s Stablecoin Strategy Raises New Questions for XRP
The stablecoin sector at Ripple has become more active by setting readiness to launch RLUSD. Stablecoins will capture a $2.8 trillion market value during the upcoming years. This industry development happens as digital asset regulations remain unclear throughout the market.
Analysts suggest that RLUSD complies with the IMF standards for utility token identification. The assertion about XRP’s regulatory status increases the difficulty of understanding its position in evolving regulations. The International Monetary Fund identifies utility tokens as digital assets that allow holders to obtain goods or services from designated parties.
Such interpretation could affect the classification of multiple tokens within the entire industry. Schwartz countered XRP as being defined as a utility token based on payment capabilities because such an assessment lacks strong empirical support. The RLUSD launch seems to signal new product options from Ripple as XRP maintains an uncertain position.
The IMF changed its digital asset classification framework, bringing fresh attention to XRP’s regulatory standing. The growing Ripple initiative toward stablecoins intensifies the current digital token examination. XRP faces an unresolved status according to the new token definitions included in the IMF framework.
Also Read: Ripple CEO Highlights White House Crypto Summit as Key Turning Point
