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XRP Trust Launched by Grayscale: Could This Be the Path to the First XRP ETF.
According to fox business, Grayscale is taking initial steps to launch the U.S.’s first XRP trust, providing accredited investors direct exposure to XRP.
While a trust and an exchange-traded fund (ETF) differ, with the latter requiring Securities and Exchange Commission (SEC) approval for retail investors, Grayscale has outlined a potential path for converting its XRP trust into an ETF in the future, as seen with its Bitcoin and Ether trusts.
Grayscale played a pivotal role in introducing crypto ETFs to Wall Street after successfully suing the SEC to convert its Bitcoin trust into a “spot” ETF. This victory led to a surge in crypto ETFs from major financial institutions, including BlackRock and Fidelity.
Following the success of Bitcoin and Ethereum ETFs, the XRP community eagerly awaits a similar product for XRP.
However, the potential for an XRP ETF is complicated by ongoing legal issues between Ripple and the SEC.
The SEC sued Ripple in 2020, arguing that XRP sales to institutional investors were unregistered securities. A partial court victory for Ripple ruled that XRP sales to retail investors were not securities, but the SEC is expected to appeal this decision.
Despite these legal challenges, Grayscale remains optimistic about XRP’s long-term value, emphasizing its potential to streamline cross-border payments and optimize financial systems. Grayscale’s move to launch an XRP trust could pave the way for further developments in XRP-based investment products.