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Speculation about XRP being included in the US Reserve has sparked discussions about whether the XRPL could gain Systemically Important Financial Market Instrument (SIFMU) status.

The conversation began after Bradley Kimes, founder of Digital Perspectives and the XRP Las Vegas conference, asked X’s AI chatbot Grok a question regarding the implications of this development.

Kimes questioned whether adding XRP to the national reserve stockpile would elevate XRPL to a SIFMU rating. In response, Grok assessed the situation and pointed to several factors necessary for the rating.

So I asked my puppy.

If XRP is added to the Strategic Reserve, will XRPLedger become a Systemically Important Financial Market Infrastructure (SIFMI)?

If XRP is added to the Strategic Reserve stockpile alongside other important US assets such as oil and...

According to Grok, incorporating XRP into a strategic reserve alongside assets like gold and oil could boost the asset’s visibility and importance. However, this alone would not automatically classify the XRP Ledger as a SIFMU.

What XRPL needs to be SIFMU

In a related context, a SIFMU is a financial entity that plays a key role in the stability of the financial system. Amnesty International has explained that the SIFMU designation requires the entity to be indispensable to financial markets, as its disruption could pose risks. Simply being part of a national reserve would not meet this criterion.

Grok noted that existing financial asset management units primarily perform important financial roles such as clearing, settlement and custody of transactions on a scale large enough to impact financial stability.

It is worth noting that while XRPL offers fast and cost-effective cross-border payments, and perhaps at a better rate than these entities, it will need to significantly expand its role in these core financial services to qualify for SIFMU recognition.

Amnesty International also noted that regulatory and legal considerations are important in determining whether XRPL can achieve this status. If XRP gains recognition as a strategic reserve asset, increased regulatory scrutiny is likely to follow.

However, the case involving the SEC and Ripple needs to be resolved before any major regulatory change can happen. Interestingly, speculation has emerged that the new SEC leadership may end the case.

Another factor, according to Grok, is widespread adoption by financial institutions. Notably, XRP will need to go beyond being a reserve asset and integrate with national and international financial systems.

Additionally, Grok emphasized that the Financial Stability Oversight Council (FSOC) will need to determine whether the failure of the XRPL could destabilize financial markets. For this to happen, the role of ledgers will need to expand to make them a core part of the global financial infrastructure.

XRP in US Strategic Reserve?

Notably, discussions about XRP’s potential inclusion in the US Strategic Reserve came as President Donald Trump signed an executive order to create a crypto working group in his first week in office.

Among the task force’s responsibilities is to explore the possibility of creating a “digital asset reserve.” Notably, the term “digital asset” instead of “bitcoin” has sparked speculation that other crypto assets could be considered a reserve alongside Bitcoin.

Scott Melker revealed that he has heard from reliable sources that XRP is a strong contender. Also, with recent meetings between Ripple CEO Brad Garlinghouse and President Trump as well as Ripple’s donations to the Trump administration, speculation suggests that XRP could be included in the reserve. However, this remains unclear.

Disclaimer: This content is for informational purposes only and should not be considered as financial advice. The opinions expressed in this article may include the personal opinions of the author and do not reflect the opinion of The Crypto Basic. Readers are encouraged to conduct thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.

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