Asset Manager Bitwise Files XRP ETF Trust in Delaware
Top asset manager Bitwise has taken a further step toward offering an XRP exchange-traded fund (ETF), filing an XRP ETF Trust with Delaware’s Division of Corporations. The Sept 30 filing has been for a Delaware statutory trust, which is a business structure that must be set up in the state.
Ripple Settlement Paves Way for Possible XRP ETF
Recent news has been favorable for the XRP ETF, especially the recent settlement by Ripple Labs with the US SEC. In 2021, the SEC claimed Ripple sold XRP as an unregistered security. That was settled this year for $200 million. The resolution on the status of XRP allowed it to be listed again on exchanges and provided a clear path for investment products such as an ETF.
Another major player in the crypto space, Grayscale, already announced that it would develop an investment product called XRP Trust, which may be convertible into an ETF. That’s a ticket of growing interest in XRP-based financial instruments, whatever might be the cautious stance on crypto ETFs from the side of the SEC.
XRP ETF: Regulatory Challenges
The SEC is quite conservative when it comes to cryptocurrency ETFs, even more so after the XRP security classification controversy. Although BlackRock, Fidelity, and Bitwise have all filed successful trust registrations for both Bitcoin and Ethereum, an XRP ETF would face the same scrutiny. In fact, an XRP ETF will have to be in total compliance with the regulations that SEC puts in place, which can be quite a long and tedious process.
Ripple CEO Supports XRP ETF
The CEO of Ripple, Brad Garlinghouse, has long come out in support of the notion of an XRP ETF, addressing the power of diversification that such a product would unleash for investors. Speaking with Bloomberg back in February, Garlinghouse expressed optimism that would see wider-scale adoption of cryptocurrency ETFs, drawing an analogy from the early days of the stock market, where diversified exposure provided the key to managing risk.
Despite these developments, XRP is down 2.7% in the last day, changing hands at $0.60, as the broader cryptocurrency market has moved downwards in response to geopolitical tension.
