Bitwise Files for First Spot XRP Exchange-Traded Fund (ETF)
- Bitwise files with the SEC for the first-ever spot XRP ETF.
- Approval of the ETF may depend on the outcome of the SEC’s appeal on the XRP security classification.
- Ripple Labs’ XRP could face further legal scrutiny if deemed a security, impacting the ETF.
On Wednesday, cryptocurrency asset manager Bitwise submitted an S-1 registration statement to the Securities and Exchange Commission (SEC) to launch the first spot XRP exchange-traded fund (ETF). This ETF would provide investors direct exposure to Ripple Labs’ XRP token.
In its filing, Bitwise maintained that XRP is not a security, directly challenging the SEC’s past assertions. The company emphasized that XRP operates on a decentralized ledger, which enhances security, accountability, and accessibility. BNY Mellon will serve as the trust’s administrator and transfer agent, while Coinbase Custody will act as the custodian for the fund.
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SEC’s Ongoing Legal Battle Over XRP
The filing comes amidst ongoing litigation between the SEC and Ripple Labs. The SEC is expected to appeal a 2023 federal court ruling that determined XRP sales through crypto exchanges were not securities transactions. The SEC has until October 7 to make its appeal.
According to Galaxy Digital’s head of research, Alex Thorn, it is likely that the SEC will appeal the decision. If successful, this appeal would significantly reduce the chances of the XRP ETF being approved. Thorn shared these insights on the social media platform X on Tuesday.
Bitwise acknowledged the legal uncertainties in its filing, noting that if XRP is ultimately classified as a security, the ETF could face forced liquidation. Despite these risks, Bitwise has already launched spot bitcoin and ether ETFs in the U.S., demonstrating its ongoing commitment to expanding crypto investment options.
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