The SEC's Aug. 18 crypto fundraising proposal lets insiders sell tokens with no mandatory holding period, while a competing Senate draft would force a 12-month lockup instead. For XRP, whose legal status rests on a single court ruling rather than a statute, the outcome of that fight — and a Sept. 15 cloture vote — carries direct stakes for its pending ETFs, Ripple's IPO, and its RLUSD stablecoin.
Insiders in SEC-registered token offerings can now sell the moment their tokens stop counting as restricted securities. Under the SEC's Regulation Crypto Assets proposal, announced Aug. 18, the rule sets no federal lockup and instead relies on disclosure to protect buyers.
A competing Senate draft would block that path. Under the July 22 CLARITY Act draft, insiders must hold a token for 12 months before its network passes a control-certification test. Once it clears that bar, the minimum holding period drops to six more months.
Two philosophies, one buyer's risk
The SEC's proposal still limits how much insiders can sell. First-year sales by affiliates are capped at 30% of the aggregate offering price, and a Tier 2 offering can raise up to $75 million in a year, with up to $22.5 million of that available to insiders. But no clock runs before that money can move. The agency instead asks commenters whether a one-year hold should be added before the rule is finalized — a question that would not exist if the draft already contained one.
What it means for XRP
XRP's fate depends on a statute the SEC's new rule does not deliver. A 2023 district court ruling found that programmatic XRP sales on exchanges are not securities, but the decision binds no court outside the Southern District of New York and has never been appealed. The CLARITY Act would convert that ruling into federal law, yet Galaxy Digital cut its passage odds to 10% on Aug. 14. Polymarket now prices 2026 passage at roughly 20% ahead of the Sept. 15 cloture vote, which needs 60 Senate votes Republicans cannot supply alone.
The token trades at $1.01, down 66.8% from its July 2025 high of $3.65.
Without the Act, Ripple's seven pending XRP spot ETF applications, its IPO plans, and its RLUSD stablecoin expansion all continue to rest on that single ruling instead of the statute the SEC's proposal leaves untouched.
Sources: CryptoSlate, crypto.news
Trading involves risk.
Risk Disclaimer
