In a significant move for the cryptocurrency industry, Grayscale Investments has filed an application with the Securities and Exchange Commission (SEC) to convert its XRP Trust into an exchange-traded fund (ETF), which would be listed on the New York Stock Exchange (NYSE). This strategic initiative highlights Grayscale’s commitment to responding to investor demand for more accessible cryptocurrency investment options.
The existing XRP Trust operates as a Delaware statutory trust and currently manages over $16 million worth of XRP as of last Friday. The proposed ETF aims to continue holding XRP as its primary asset and will track its performance on a price return basis, adjusted for operational fees. This development would provide investors with a streamlined way to gain exposure to XRP’s market fluctuations.
Grayscale is not alone in this venture; other firms such as CoinShares and Bitwise have also submitted applications for XRP-based ETFs. This trend indicates a burgeoning institutional appetite for structured investment products centered around XRP, reflecting an increasing recognition of the asset’s potential.
Earlier in January, Ripple Labs president Monica Long expressed optimism that an XRP ETF could “soon be a reality” under the new Trump administration, which has promised to foster crypto innovation in the U.S. and support locally based enterprises. Long’s comments underscore the anticipation surrounding regulatory developments in the cryptocurrency space.
Furthermore, trading volumes on XRP-native applications have surged recently, signaling rising favor among investors. Specifically, swap volumes on the XRP Ledger’s decentralized exchange (DEX) exceeded $400 million in January, subsequently surpassing the $1 billion mark for the first time since the launch of its automated market maker feature in May. Industry analysts suggest that this milestone contributed to establishing 2024 as a “monumental” year for the token.
As the cryptocurrency landscape continues to evolve, the potential approval of XRP ETFs could pave the way for broader institutional adoption and enhance liquidity in the market, ultimately benefiting investors and stakeholders in the crypto ecosystem.
