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Grayscale Seeks SEC Nod for $16M XRP Trust to ETF Conversion

Coin WorldFriday, Jan 31, 2025 8:00 am ET

1min read

Grayscale Seeks SEC Approval to Convert $16M XRP Trust to ETF

Grayscale Investments, a leading digital asset manager, has filed a proposal with the U.S. Securities and Exchange Commission (SEC) to convert its $16 million XRP Trust into an exchange-traded fund (ETF). This move comes as institutional interest in XRP continues to grow, with major asset managers like Bitwise, Canary Capital, WisdomTree, and 21Shares submitting filings for XRP ETFs.

The conversion of the XRP Trust to an ETF would provide investors with a more liquid and accessible way to gain exposure to XRP, the native cryptocurrency of the Ripple network. An ETF structure would also allow for greater institutional participation in the XRP market, potentially driving demand and inflows.

The SEC's stance on cryptocurrency ETFs has been a topic of debate in recent years. However, under the Biden administration and SEC Chair Gary Gensler, there has been a shift in regulatory sentiment, favoring the approval of crypto-related ETFs. Polymarket bettors currently assign an 83% chance of XRP ETF approval by 2025, reflecting growing optimism in the market.

The potential approval of an XRP ETF could have significant implications for the cryptocurrency's price. Analysts have noted similarities between the current market setup and XRP's 2017 breakout, which led to a 2,900% rally. If history repeats, XRP could reach $99, but the approval of an ETF could be the ultimate catalyst to drive demand and institutional inflows. AI models like DeepSeek also forecast an explosive run, predicting XRP will reach $30 before the year ends.

In addition to the XRP ETF, Purpose Investments, a leading asset management firm, has filed a preliminary prospectus with the Canadian securities regulatory authority for the first Ripple ETF. This move showcases Purpose Investments' commitment to expanding its offerings in the cryptocurrency domain, catering to institutional and retail investors alike. The launch of the Purpose Ripple ETF could set a precedent for future crypto ETFs within the region, prompting further regulatory evaluations and potential approvals.

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