Cboe Files Four XRP ETF Applications Amid Regulatory Uncertainty

Cboe Exchange has submitted four separate applications to the Securities and Exchange Commission (SEC) for spot XRP ETFs from WisdomTree, Bitwise, 21Shares, and Canary. This move comes as major asset managers are vying to launch the first spot XRP ETFs in the U.S., following the successful introduction of Bitcoin and Ethereum ETFs last year.

Despite XRP's recent 25% decline and the broader crypto market cooling, asset managers are betting on its recovery and the growing interest in crypto investment vehicles. However, XRP faces significant regulatory hurdles, unlike Bitcoin and Ethereum, which have well-established futures markets. Cboe's filings aim to fortify XRP's position as an ETF candidate while addressing the SEC's regulatory uncertainties.

The filings lean heavily on the July 2023 ruling in the SEC v. Ripple Labs case, where XRP sales were partially classified as not being securities. Asset managers are implementing strict safeguards, such as sourcing XRP from secondary markets rather than directly from Ripple Labs, to enhance their chances of receiving SEC approval. Other measures include advanced surveillance systems, third-party custody arrangements, and cold storage of XRP.

The SEC has 45 days to review these applications, with possible extensions of up to 90 days. The outcome will be crucial not just for XRP but for the broader ETF landscape as regulators continue to revise their approaches to digital assets. The coming months will reveal whether these proposals will meet the SEC's scrutiny, potentially setting a precedent for other cryptocurrencies seeking ETF status.