March 4, 2021

Japan's financial regulator does not consider XRP as a security

The Japan Financial Services Agency (FSA) treats XRP as a cryptocurrency, not a security. Regulator first outlined the legal status of the token in a letter to The Block.

"The FSA views XRP as a cryptocurrency based on the definitions of the Japan Payment Services Act," the FSA quoted the publication as saying.

Under the law, a digital asset is a "cryptocurrency" or "virtual currency" when it is used as a means of payment and is not denominated in fiat.

Last month Research InstituteNomura wrote in a report that XRP is a crypto asset, not a security. In December, Japanese financial giant SBI Holdings backed the researchers' stance.

The UK Treasury also does not consider XRP to be a security.

"Exchange-traded tokens such as Bitcoin, ETH and XRP are not subject to regulation," the UK agency said in a January statement.

On December 23, the US Securities and Exchange Commission filed a lawsuit against Ripple. According to the department, the company sold unregistered securities in the form of tokens.

The CEO of the California-based blockchain company Brad Garlinghouse denied the charges and promised to defend Ripple in court. Preliminary hearings will take place on February 22, 2021.