SBI Group Stands Firm Behind Ripple: XRP Is a Cryptocurrency, Not a Security in Japan

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In a significant show of support for Ripple, Japan’s influential SBI Group has reaffirmed its confidence in the company and its native digital asset, XRP. Despite the U.S. Securities and Exchange Commission (SEC) lawsuit classifying XRP as a security, SBI Group maintains that XRP operates legally within Japan’s regulatory framework as a cryptocurrency—specifically categorized under the country's Payment Services Act as a "crypto asset," not a "security" governed by financial instruments laws.

This stance was officially communicated in a public announcement released by SBI Group on December 28, 2020, underscoring its continued partnership with Ripple and clarifying the legal standing of XRP in the Japanese market.

XRP’s Regulatory Status in Japan

SBI Group cited an article published by Nomura Research Institute to reinforce its position. According to the analysis, XRP is widely traded across licensed Japanese exchanges and falls squarely under Japan’s Act on Settlement of Funds, which regulates cryptocurrencies. This means that entities offering XRP trading do not need to file securities registration with Japan’s Financial Services Agency (FSA), unlike assets classified as securities under the Financial Instruments and Exchange Act.

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The distinction is critical: while the SEC's case hinges on whether XRP qualifies as an unregistered security in the U.S., Japan has already established a clear regulatory boundary. In this context, XRP’s compliance status remains intact in one of Asia’s most advanced fintech markets—providing a strong counter-narrative to the U.S. legal challenge.

This regulatory clarity allows platforms like SBI VC Trade, a subsidiary of SBI Group, to continue offering XRP trading services without legal conflict. The group emphasized that its operations remain unaffected by the ongoing litigation between Ripple and the SEC.

Strategic Investment in Ripple, Not Just XRP

A key point highlighted by SBI Group is that its involvement with Ripple goes beyond mere token ownership. The company clarified that it has not made direct investments in XRP holdings but instead holds strategic equity in Ripple Labs itself—a long-term bet on the company’s technology and cross-border payment solutions.

SBI VC Trade and other affiliated platforms maintain only operational reserves of XRP to facilitate customer trading activity. Therefore, even during periods of extreme price volatility—such as the sharp decline following the SEC lawsuit—the financial impact on SBI Group remains minimal.

While SBI Group’s stock did experience an initial dip of over 8% after the SEC news broke, the organization's fundamentals and blockchain-focused business units remain resilient. This underscores investor confidence in SBI’s diversified fintech portfolio, which includes digital asset custody, exchange services, and blockchain infrastructure development.

Global Exchange Reactions to the SEC Lawsuit

The ripple effects (pun intended) of the SEC lawsuit have been felt worldwide. Bitstamp, currently ranked among the top seven cryptocurrency exchanges globally, announced plans to restrict XRP trading for U.S. customers starting January 2021. However, international users will continue to have full access to XRP markets.

This bifurcation reflects a growing trend: regulatory actions in one jurisdiction do not necessarily dictate policy elsewhere. As seen in Japan, Switzerland, Singapore, and other forward-thinking markets, regulators are taking nuanced approaches based on local frameworks rather than following U.S. enforcement leads.

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This divergence strengthens the argument that digital assets should be assessed based on their use case, distribution model, and economic function—not solely on jurisdictional enforcement trends.

FAQ: Understanding XRP’s Legal Status and Market Impact

Q: Is XRP considered a security in Japan?
A: No. Under Japanese law, XRP is classified as a crypto asset regulated by the Payment Services Act, not a security under the Financial Instruments and Exchange Act. This allows it to be freely traded on licensed exchanges without additional securities disclosures.

Q: Did SBI Group lose money when XRP’s price dropped?
A: Not significantly. SBI Group invests in Ripple as a company, not primarily in XRP tokens. Its exchange arm holds only operational balances of XRP for trading purposes, insulating it from major market swings.

Q: Will changes at the SEC affect the Ripple lawsuit?
A: Unlikely in the short term. Even if leadership changes occur at the SEC, the case is driven by career enforcement staff and commission votes. Legal experts note that replacing the chair does not automatically alter ongoing litigation.

Q: Can I still trade XRP outside the U.S.?
A: Yes. Major international exchanges like Bitstamp, Binance, and others continue to offer XRP trading pairs for non-U.S. users. Japan-based platforms also maintain full support.

Q: What makes Japan’s approach to crypto different from the U.S.?
A: Japan adopts a principles-based regulatory model focused on consumer protection and anti-money laundering (AML), whereas the U.S. often applies legacy securities laws to new technologies. Japan also requires exchange licensing and regular audits, fostering a compliant yet innovative ecosystem.

Looking Ahead: A Test Case for Global Crypto Regulation

The Ripple vs. SEC case has become a landmark battle over how blockchain-based assets should be classified and governed. While the outcome remains uncertain in the U.S., jurisdictions like Japan provide real-world examples of how digital assets can coexist with clear regulations without stifling innovation.

SBI Group’s unwavering support sends a powerful message: institutional players believe in Ripple’s technology and long-term vision for decentralized payments. Moreover, it highlights the importance of jurisdictional diversity in shaping the future of finance.

As more countries develop tailored frameworks for digital assets, we may see a multi-polar regulatory landscape emerge—one where assets like XRP can thrive legally in compliant markets regardless of challenges in others.

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Core Keywords

With strong backing from major financial institutions and clear regulatory pathways in key markets, the story of XRP is far from over. The coming months will likely bring more clarity—not just from courts, but from evolving global standards that recognize the unique nature of decentralized technologies.