Bitwise Files Application for XRP Exchange-Traded Fund

TLDR

• Bitwise has filed for an XRP ETF with the state of Delaware
• This follows SEC approvals of Bitcoin and Ethereum ETFs earlier in 2024
• XRP is currently the seventh-largest cryptocurrency by market cap
• Bitwise confirmed the filing but won’t comment further on the fund at this stage
• The move comes despite past legal clashes between the SEC and Ripple over XRP

Bitwise Asset Management, a prominent cryptocurrency investment firm, has taken a significant step towards launching an exchange-traded fund (ETF) based on XRP, the digital asset associated with Ripple.

This move comes in the wake of recent approvals for Bitcoin and Ethereum ETFs by the U.S. Securities and Exchange Commission (SEC) earlier in 2024.

The San Francisco-based company has filed an application with the state of Delaware to create an XRP ETF, confirming the legitimacy of the filing to Decrypt, a crypto news outlet.

However, Bitwise has refrained from providing additional comments on the fund while it remains in the filing stage.

XRP, currently ranked as the seventh-largest cryptocurrency by market capitalization, was created by the founders of Ripple, a fintech company focused on improving cross-border payment systems.

Despite their shared origins, XRP and Ripple now operate independently.

The potential launch of an XRP ETF marks another milestone in the growing acceptance of cryptocurrency-based investment products in traditional financial markets.

ETFs are popular investment vehicles that trade on stock exchanges, allowing investors to gain exposure to underlying assets without directly owning them.

The crypto ETFs approved in the United States this year have seen significant success, attracting billions of dollars in inflows over a short period.

This enthusiasm has encouraged asset managers like Bitwise to explore opportunities with other digital assets beyond Bitcoin and Ethereum.

However, the path to an XRP ETF approval may face unique challenges due to the complicated history between Ripple and the SEC.

In 2020, the SEC filed a $1.3 billion lawsuit against Ripple, alleging that the company had sold unregistered securities in the form of XRP to raise funds.

The legal battle between Ripple and the SEC reached a partial resolution in 2023 when a judge ruled that programmatic sales of XRP to retail investors did not qualify as securities.

This decision was widely interpreted as a victory for the crypto industry, although the judge also determined that $728 million worth of contracts for institutional sales did constitute unregistered securities sales.

Despite this complex legal backdrop, the cryptocurrency market has shown continued interest in XRP. At the time of the Bitwise filing, XRP was trading at $0.61, showing a 3% increase over the previous week.

The potential introduction of an XRP ETF aligns with predictions made by some financial institutions. Standard Chartered, a British multinational bank, suggested in a recent research note that Solana and XRP would likely be next in line for ETF approvals following the success of Bitcoin and Ethereum funds.