Prominent cryptocurrency exchange Coinbase has classified XRP (XRP) and Shiba Inu (SHIB) as currencies, emphasizing their design as money or stores of value. This classification places them in a group of digital assets that, according to Coinbase, are intended to act as mediums of exchange or value preservation.
Coinbase’s categorization of XRP and SHIB underscores their potential not only as transaction tools but also as valuable digital assets. Despite the volatility that characterizes the crypto market, these tokens demonstrate core monetary attributes. They can function as units of account, mediums of exchange, and stores of value—qualities fundamental to any form of currency.
Regulatory Uncertainty Surrounding XRP
XRP has been at the center of regulatory debates for some time, despite a court ruling clarifying that it is not inherently a security. The legal status of XRP became a hot topic when the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs, a major stakeholder of XRP, in 2020. The SEC argued that XRP was being sold as an unregistered security.
A recent court ruling provided some clarity by determining that XRP is not a security in itself, though it can be treated as part of an investment contract in certain contexts. This decision brings XRP a step closer to regulatory resolution, and Coinbase’s classification aligns with an earlier view held by the U.S. Financial Crimes Enforcement Network (FinCEN), which identified XRP as a virtual currency back in 2015.
SHIB's Regulatory Position
Shiba Inu, while not explicitly targeted by the SEC, remains subject to the broader uncertainties surrounding cryptocurrency regulations. SHIB enthusiasts, however, have found some reassurance in Coinbase's classification, which strengthens its position as a legitimate asset for transactions and a potential store of value.
XRP and SHIB as Legitimate Transaction Tools
In a broader move, Coinbase included XRP, SHIB, and seven other cryptocurrencies under its "currencies" classification. Alongside major players like Bitcoin (BTC), Dogecoin (DOGE), Bitcoin Cash (BCH), and Litecoin (LTC), this step reinforces the potential for these assets to serve as legitimate instruments of exchange.
Other digital assets on Coinbase’s "currencies" list include Stellar Lumens (XLM), Zcash (ZEC), and Dash (DASH). By placing these tokens under the same umbrella as BTC, the exchange emphasizes their potential to function as usable, transferable currencies.
The Future of XRP and SHIB as Stores of Value
While the classification highlights the potential of these tokens as stores of value, the inherent volatility of the cryptocurrency market continues to pose challenges. However, many investors believe that as the market matures, the instability of these assets will eventually stabilize, making XRP and SHIB more viable as long-term stores of value.
Coinbase's recognition of these tokens’ fundamental monetary characteristics is a significant step forward, legitimizing their use as both transactional currencies and potential stores of wealth. This classification reflects the ongoing evolution of the crypto market, where regulatory clarity and market sentiment will continue to shape the future of digital currencies like XRP and SHIB.
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