Bitwise Files for Spot XRP ETF

Key Takeaways

• The Bitwise XRP ETF was registered with CSC Delaware Trust Company as its agent. 
•  If the ETF were approved, it would offer institutional investors a regulated pathway to invest in XRP.

Leading crypto index fund manager Bitwise, has officially filed for a spot exchange-traded fund (ETF) to give investors exposure to XRP. According to a September 30, 2024 filing, the Bitwise XRP ETF was registered with CSC Delaware Trust Company as its agent. While this filing marks the beginning stages, it suggests Bitwise is gearing up for a potential submission to the U.S. Securities and Exchange Commission (SEC), though formal approval could still take months.

This development follows Ripple CEO Brad Garlinghouse’s recent statements that an XRP ETF was “inevitable” after the approval of Bitcoin and Ether ETFs in the U.S. If the ETF were approved, it would offer institutional investors a regulated pathway to invest in XRP.

Speculation about an XRP ETF has circulated for months, including a false filing for a “BlackRock iShares XRP Trust” in November 2023, which briefly inflated the price of XRP before being debunked.

This move comes as Ripple remains locked in a legal battle with the SEC. In 2020, the SEC accused Ripple of conducting an unregistered securities offering through the sale of XRP. While a July 2023 ruling provided partial relief for Ripple, declaring XRP was not a security when traded on public exchanges, the court left open the possibility that institutional sales could still be subject to securities regulations.

Bitwise Chief Investment Officer Matthew Hougan confirmed the registration on Tuesday, stating, “It is a registration of a trust entity in Delaware,” and promised to share more information soon. Although no spot XRP ETF has been approved by the SEC, the agency has been more open to other crypto ETFs this year. In January, it approved spot Bitcoin ETFs from firms like BlackRock, Grayscale, and Fidelity. Later in the year, the SEC also greenlit eight Ethereum ETFs.

The SEC has been cautious in approving spot Bitcoin exchange-traded products (ETPs). During a financial conference on September 17, Natasha Vij Greiner, Director of the SEC’s Division of Investment Management, pointed out that products like Bitcoin ETPs don’t have the same protections as those under the Investment Company Act of 1940.

The latest development also comes amid Ripple gearing up to launch its U.S. dollar-pegged stablecoin, RLUSD. Garlinghouse recently revealed that the stablecoin is in private beta testing and could launch within “weeks, not months.” The stablecoin is being tested on the XRP Ledger and Ethereum networks, with plans for further expansion.