The SEC Just Handed XRP a Massive Win. Here's Why $3 Is Back On the Table.

When the Securities and Exchange Commission (SEC) sued Ripple in 2020, alleging that XRP (CRYPTO: XRP) was an unregistered security, the coin's aspirations of being adopted by financial institutions were one step away from falling through a legal trapdoor. Even after the lawsuit was resolved in Ripple's favor in 2025, regulatory clarity remained incomplete.

That changed on March 17, when the SEC and the Commodity Futures Trading Commission (CFTC) published a new regulatory plan classifying XRP as a "digital commodity" alongside most other leading cryptocurrencies.

Now, XRP enjoys a place in a clean framework that its target users will feel comfortable engaging with. The coin is currently priced at $1.44, but $3 is now firmly back on the table. Here's why.

Image source: Getty Images.

What the new classification unlocks

After the SEC's lawsuit was settled, the outcome was that XRP was not to be considered a security in the eyes of the law. That's important because securities are subject to SEC registration requirements and disclosure rules, not to mention requirements governing how management may communicate with investors. But for risk-averse actors like financial institutions, which are XRP's target users, a lack of a certain classification for an asset is not the same as having a clear classification in hand. XRP now has that clear classification as a digital commodity.

Commodities, overseen by the CFTC, receive lighter oversight than securities. In short, the SEC and CFTC both agreed that XRP's value derives from its network's operations and supply-and-demand dynamics.

That's key, as it gives Ripple the green light to continue building demand for XRP by making it part of its financial infrastructure and services stack. Thus, the new classifications also give financial institutions the confidence that participating in XRP's ecosystem won't put them in legal trouble.

The path to $3

At today's price of $1.39, reaching $3 would mean growing by slightly more than double. Considering XRP's prior all-time high was $3.65, and was set in 2025, it's fully plausible that this new regulatory clarity will create the conditions for the coin to surpass $3 again.

The first signs that the coin is going back toward its all-time high will likely show up as capital inflows into the XRP exchange-traded funds (ETFs). They currently have $1.2 billion in assets under management (AUM), with $4.6 million in net inflows occurring on March 17, when the new guidance was published. Notably, those inflows broke a streak of big outflows, so the tide may have just turned.

But don't rush to bet the farm on XRP hitting $3 in the short term. It's quite volatile, and the currently bearish macro conditions could still weigh it down for a while.

Alex Carchidi has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends XRP. The Motley Fool has a disclosure policy.