The CBOE BZX exchange has officially filed with the SEC to list and trade spot XRP ETFs, marking a significant step in the crypto ETF landscape. The filing, submitted on behalf of WisdomTree, Bitwise, 21Shares, and Canary Capital, is by firms aiming to launch exchange-traded products tracking XRP, the fourth-largest cryptocurrency by market capitalization.
Application Process
This filing marks the second part of a two-step process for launching a crypto ETF. Once acknowledged by the SEC, the proposal will be published in the Federal Register, officially starting the agency’s approval process. Industry experts predict that with a pro-crypto administration and the upcoming new SEC chair, the approval of XRP spot ETFs could happen as early as this year.
Expanding Investor Access
According to the filing, "The Exchange believes that approving this proposal (and comparable proposals) provides the Commission with the opportunity to allow U.S. investors access to XRP through a regulated and transparent exchange-traded vehicle that would limit risk to U.S. investors." Unlike previous crypto ETFs, XRP lacks an established futures market on the Chicago Mercantile Exchange (CME), a key component in the SEC’s decision-making process for Bitcoin and Ethereum approvals. To increase the likelihood of approval, WisdomTree, one of the filing firms, is implementing safeguards such as sourcing XRP from secondary markets rather than Ripple Labs, avoiding any direct ties with the company at the center of the SEC's legal battle.
Growing Interest in XRP ETF
Interest in XRP ETFs has increased after Ripple Labs won a partial legal victory in July 2023, with a favorable ruling in its ongoing SEC lawsuit. This legal outcome has been referenced in ETF applications. As the approval process for these ETFs continues, there is growing anticipation that a wave of institutional investment could flood into the market. The launch of XRP ETFs, along with similar products targeting top cryptocurrencies like Solana, would offer investors greater exposure to the digital asset space.
The CBOE BZX filing for spot XRP ETF listing marks an important step in the evolution of crypto ETFs and may pave the way for new investment opportunities in the digital asset market.
