Ripple Calls for SEC to Revamp Crypto Oversight with Real-World Sandboxes
Ripple has made a bold move by urging the U.S. Securities and Exchange Commission (SEC) to revamp its approach to regulating the crypto industry. In a proposal submitted on May 28, 2025, Ripple outlined the benefits of creating regulatory sandboxes to foster innovation and address regulatory gaps in the digital asset space.
Ripple’s Proposal: Sandboxes Reflecting Live Conditions for Effective Regulation
According to Ripple, the establishment of regulatory sandboxes for digital asset products, including tokenized Real World Assets (RWAs), can provide a controlled environment for market participants to operate while being subject to regulatory oversight. This approach allows regulators and companies to collaborate in real-time, identifying areas where existing financial regulations may need to be updated or enhanced.
“A regulatory sandbox for digital asset products, like tokenized Real World Assets (RWAs, allows digital asset markets, innovative products, and value-creating services to operate in a controlled environment while subject to regulatory oversight.”
Ripple emphasized the importance of creating sandboxes that closely mimic live market conditions, rather than relying on small-scale pilots. By simulating production-like environments with actual customer cohorts, real transaction volumes, and cross-border operational elements, firms can test products and infrastructure effectively.
The company cited successful case studies from other jurisdictions, such as Singapore’s Project Guardian, the European Blockchain Regulatory Sandbox, and the UK’s Digital Securities Sandbox, as examples of how regulatory sandboxes can drive innovation while ensuring regulatory compliance. Ripple urged the SEC to consider similar mechanisms in the U.S. to facilitate collaboration between regulators and innovators and facilitate the transition of sandbox-tested solutions into regulated markets.