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Grayscale Seeks SEC Nod to Turn Ripple (XRP) Trust into an ETF

Grayscale Investments has taken a significant step towards expanding the investment landscape for XRP by filing an application with the U.S. Securities and Exchange Commission (SEC) to transform its XRP Trust into an Exchange-Traded Fund (ETF) listed on NYSE Arca. This move aligns Grayscale with other asset managers like CoinShares and Bitwise, who have also proposed XRP investment products to the SEC, signaling a growing interest in institutional access to this cryptocurrency.

Currently, the Grayscale XRP Trust manages about $16.1 million in assets, operating under the structure of a Delaware statutory trust. The proposed conversion to an ETP aims to democratize access to XRP, allowing a broader investor base to participate while also bringing the benefits of SEC oversight and the regulatory framework of a national securities exchange. This oversight is expected to provide a layer of security and transparency that individual investors might appreciate when investing in digital assets without the complexities of direct ownership or self-custody.

Grayscale’s initiative follows closely on the heels of its applications for Solana and Litecoin ETFs, indicating a strategic push towards diversifying its cryptocurrency ETF offerings. This move could be seen as part of a broader trend where traditional finance mechanisms are increasingly integrating with the crypto world, aiming to provide regulated, accessible investment vehicles for digital assets.

Despite this major development, XRP’s market price has risen just 1%, hovering around $3.13, with little immediate reaction to the news.

If the SEC approves this ETF, it would represent a milestone for XRP, offering investors a regulated pathway to gain exposure to this digital asset. Such an approval could potentially lead to increased liquidity and investor interest in XRP, as it would be one of the few cryptocurrencies available through a regulated ETF structure in the U.S. This could also set a precedent for other crypto assets looking to gain similar institutional acceptance.

The conversion of the Grayscale XRP Trust into an ETP would not only facilitate broader market access but would do so under the watchful eye of one of the world’s leading financial regulatory bodies, potentially instilling greater confidence among investors wary of the volatility and regulatory uncertainties often associated with cryptocurrencies. This development underscores a pivotal moment where cryptocurrency might further bridge the gap between digital and traditional finance, enhancing XRP’s role in the global financial ecosystem.

WallStreetPit does not provide investment advice. All rights reserved.

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