XRP and Stellar (XLM) Surge 8%... Will Regulatory Shackles Be Released?

▲ XRP, Stellar (XLM)/AI-generated image

XRP and Stellar (XLM) both surged more than 8% ahead of a Senate vote on the US cryptocurrency market structure bill.

According to cryptocurrency media outlet BeInCrypto on September 15 (local time), XRP rose 8.42% on September 14, and XLM jumped 8.44%. The market showed strong buying sentiment ahead of the procedural vote on the US cryptocurrency market structure bill scheduled for September 15 in the US Senate. The bill aims to more clearly distinguish regulatory authority over digital assets between the US Securities and Exchange Commission (SEC) and the US Commodity Futures Trading Commission (CFTC). It also includes provisions to classify some digital assets as commodities rather than securities.

XRP and XLM are considered direct beneficiaries of regulatory clarity. In joint guidance issued last March, the SEC and CFTC cited XRP, XLM, and HBAR as examples of digital commodities. Analysis suggests that if this classification is solidified into law, it could reduce legal uncertainty for institutional investors in payment and settlement networks. XRP has been used for cross-border payments, while XLM has expanded low-cost remittances and traditional financial infrastructure connections. Recently, U.S. Bank completed a cross-border stablecoin trial on the Stellar network.

On September 13, Senate Republicans unveiled a final version reflecting 126 major amendments requested by Democrats. The 635-page bill includes strengthened ethics rules, expanded enforcement powers for state attorneys general, and authority for the US Treasury to respond when payment stablecoins facilitate deposit outflows from regional banks. The vote is scheduled for September 15 at 2:15 PM Eastern Time, and 60 votes are required for the bill to advance to the next stage. As Republicans hold 53 seats, even if all vote in favor, an additional seven votes from Democratic or independent senators will be needed.

Ripple CEO Brad Garlinghouse emphasized about the amendment, "Perfection should not be the enemy of the good." However, three issues remain contentious until the last minute: ethics rules related to former US President Donald Trump's $1.4 billion cryptocurrency income, Section 604 dealing with decentralized finance developer liability, and the issue of stablecoin revenue, which could affect Coinbase's (COIN) annual USDC reward revenue of approximately $1.35 billion, are all variables in the negotiations.

Expectations for the bill's passage are not yet high. Prediction market Polymarket's probability of passage this year dropped from 82% in February to 30%, and Galaxy Research put the possibility at 10%. BeInCrypto reported that even if the cloture vote fails on September 15, the bill will not be immediately discarded, but the likelihood of comprehensive market structure legislation being pushed back to 2027, after the midterm elections, could increase.

[Article Summary]

-XRP and XLM rose by 8.42% and 8.44% respectively, ahead of the vote on the US cryptocurrency market structure bill.

-To advance the bill to the next stage, 60 votes are needed in the Senate, requiring at least seven additional votes from Democratic or independent senators.

-Polymarket's probability of the bill passing this year is 30%, and Galaxy Research's forecast is 10%, indicating market expectations remain low.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*