Bitwise files for creating an XRP cryptocurrency ETF

Bitwise Asset Management has filed an application for a US-based exchange-traded fund based on the price of XRP, the world's seventh-largest cryptocurrency by market value.

The Bitwise XRP ETP will hold XRP directly, according to Bitwise's S-1 registration statement with the Securities and Exchange Commission on Wednesday.

Bitwise's proposal comes less than two weeks after Grayscale Investments added an XRP trust to its cryptocurrency investment products, sparking speculation that Grayscale could issue its own XRP ETF.

XRP is the token of the XRP Ledger, a blockchain network designed to make cross-border payments faster and more efficient.

According to data provider CoinMarketCap, XRP was last trading at around 58 cents, down more than 4% in the last 24 hours.

This year, issuers have stepped up efforts to meet increasing demand for crypto-focused investments, particularly those based on the sustained price of key digital assets. Bitwise has already launched ETFs based on the spot price of Bitcoin and Ether, the two largest cryptocurrencies by market capitalization. Ether is the token of the Ethereum blockchain.

The SEC must approve the Bitwise S-1 filing and a subsequent 19-b4 filing, a formal rule change request showing that the issuer has addressed regulators' concerns, before the fund can begin trading.

Spot Bitcoin ETFs are surging

The Bitwise Bitcoin ETF (BITB) has generated more than $2.1 billion in net inflows, the fourth-highest among the 11 funds that launched in January after receiving SEC approval. According to data from British asset manager Farside Investors, these highly successful ETFs have generated nearly $19 billion in inflows.

The approvals for Bitcoin funds appeared to create a more favorable regulatory environment. In July, the agency approved nine Ether-based funds, including the Bitwise Ethereum ETF (ETHW). ETHW has generated around $326 million in inflows, the third-largest among young products, although the funds have seen a lukewarm investor reception with net outflows.

Over the summer, 21Shares and VanEck filed with the SEC for ETFs based on the spot price of Solana, the token on the Solana blockchain and the fifth-largest cryptocurrency by market capitalization. Last month, the SEC gave the green light to options trading BlackRock's iShares Bitcoin Trust (IBIT)another sign of a more receptive regulatory environment. An option is a financial instrument that gives its owner the option to buy or sell an underlying asset.

In a statement, Bitwise CEO Hunter Horsley noted the potential of blockchain technology to transform monetary systems.

The story continues

“That’s why we’ve spent the last seven years helping investors capitalize on the opportunities in this space, and we’re excited to continue that work with our filing,” he said.

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