The regulatory certainty in South Korea may help the XRP price. Rahul Advani, director of policy for the APAC region, claims that 90% of Ripple’s business is handled outside of the United States, with a substantial portion occurring in the Asia-Pacific region, which includes South Korea.
Ripple remittances have increased, particularly the On-Demand Liquidity (ODL) service that employs XRP in the APAC region due to the demand for quick settlements and fast access to funds.
🇰🇷 South Korea is gearing up to provide more regulatory clarity for #crypto this year.
Ripple’s APAC Policy Director @radvanisg discusses how policymakers can strike a balance between consumer protection and fostering innovation in the sector. https://t.co/Y06ZSnNr8L
— Ripple (@Ripple) March 16, 2023
In a significant step toward achieving such regulatory clarity, the Financial Services Commission (FSC) of South Korea recently announced criteria for determining whether digital assets would be labeled security tokens (STOs) and, therefore, come under regulations applicable to financial instruments.
XRP will be categorized as a security if it gives investors a say in how a company is run, gives investors the right to dividends or residual property, or ensures the issuer credits investors with corporate profits.
The necessary amendments to the Capital Markets Act to recognize STOs are projected to be completed in the first half of 2023 and implemented in 2024 after being passed by the South Korean Parliament.
The South Korean National Assembly is now reviewing the proposed Digital Asset Basic Act, which will govern XRP that does not meet the criteria for STOs. XRP might not be regarded as a security token or be covered by the upcoming Digital Asset Basic Act because it is a payment token.
XRP/USD 4-hour chart | Source: TradingView
Back in the States, Ripple is defending itself against an SEC complaint that claims the $1.3 billion sale of XRP was an unregistered security offering. The SEC is frequently criticized for failing to provide the American cryptocurrency industry with clear regulatory rules.
Read more:
- John Deaton Explains Why ETH Was Picked Over XRP To Allege In KuCoin Case
- Here’s Why XRP Holders Should Hope For A “Thin Victory” For Ripple Against The U.S. SEC
- XRP Price Action Has Been More Stagnant, With No Specific Direction And Limited Volatility