CLARITY Act Could Force Ripple to Transfer Billions of XRP to U.S. Government

The CLARITY Act is making its way through the U.S. Congress, sparking speculation about its potential impact on XRP. According to LunaLuna, a crypto commentator, passing the bill could lead to significant changes in Ripple's holdings of XRP.

LunaLuna points out that once the CLARITY Act passes, Ripple must hold less than 20% of XRP's total supply for XRP to avoid classification as a security. To achieve this, Ripple would need to transfer a portion of its XRP to the U.S. government.

This move could have far-reaching consequences, as it would satisfy the condition for adoption by the International Monetary Fund (IMF). The IMF can only adopt assets that a nation has first adopted, and ownership by the U.S. government would meet this requirement.

With XRP potentially being adopted by the IMF, it could gain standing to set its price, positioning it as a candidate for institutional reserve at the highest level. However, not everyone agrees with LunaLuna's theory. CryptoSensei notes that the CLARITY Act contains no provisions for transferring assets to the government, and that the IMF does not set prices for external assets.