XRP News Today: Ripple Proposes Token Maturity Framework to Clarify Crypto Regulations

Ripple has recently taken a significant step in challenging the Securities and Exchange Commission (SEC) by proposing a new framework for classifying cryptocurrencies. This framework, known as the Token Maturity Framework, aims to provide clear guidelines on when a digital asset should no longer be considered a security. The proposal addresses a key point raised by Commissioner Hester Peirce in her “New Paradigm” speech, which questioned the criteria for determining when a token is no longer an investment contract.

The Token Maturity Framework suggests that if the issuer's commitments are fully met and token holders have no recourse to sue the issuer, the token should not be classified as a security. Ripple argues that this approach aligns with existing laws and fosters innovation within the crypto sector. The framework rejects vague SEC terms such as “sufficient decentralization” and “fully functional,” instead focusing on measurable factors like network status, value, and governance. Ripple believes that tokens on strong, well-maintained, and highly valued networks that are not centrally controlled should not be regulated as securities.

The proposal also references the SEC v. Ripple case, where Judge Analisa Torres ruled that XRP is not a security. However, the SEC found that some early institutional sales were investment contracts, resulting in a $125 million penalty for Ripple. The company aims to avoid similar regulatory confusion in the future. Ripple also supports the expansion of a safe harbor law for legitimate crypto projects, which would exempt them from securities law at the outset, encouraging innovation while ensuring compliance.

Ripple's letter to the SEC’s Crypto Task Force highlights the need for clearer regulations to foster innovation and prevent regulatory confusion. The company advocates for Congress to establish a clear set of standards for digital assets rather than the SEC. Ripple believes that when regulators impose their rules on a wide scale, it brings confusion and hinders the development of legitimate projects. The token maturity test proposed by Ripple requires 10 years of network operation, a market capitalization of over $1 billion, and no domination by a single entity. According to Ripple, assets meeting these criteria are already integrated into global financial systems, traded in liquid markets, and support regulated items such as ETFs.

The proposal comes at a time when legal battles over crypto continue. Ripple and the SEC reached a $50 million settlement in April 2025, which was less than the initial $125 million fine. However, a federal court rejected a joint request for an indicative decision on May 15, 2025, due to various issues with the process. Both sides are expected to file another motion to approve the settlement. The call for clear regulations reflects wider industry needs, with other major players like Coinbase and the Blockchain Association also advocating for updated rules to support the growth of the crypto industry.

Ripple’s plan could significantly impact how the SEC oversees digital asset transactions. By focusing on token maturity, the framework helps tokens transition out of securities classification, potentially attracting more users to XRP. The 2023 ruling, which clarified that XRP is not a security in secondary markets, has already led to a 370% increase in its price since November 2024. However, the cryptocurrency market remains volatile, and a closed-door meeting by the SEC on May 29, 2025, could lead to renewed settlement discussions, affecting XRP’s price and prospects for an ETF.

Ripple emphasizes the importance of a stable regulatory framework for the industry. The company believes that XRP, which operates on decentralized networks and is used in large markets, should not be subject to securities law. This aligns with the industry’s call for regulations that protect investors while allowing for growth. The outcome of the proposal remains uncertain, but if adopted, the token maturity test could serve as a model for other cryptocurrencies, helping to clarify the regulatory landscape for the industry.