Purpose Investments Files for World's First XRP ETF Amidst SEC Legal Battle

Canadian asset management firm Purpose Investments has filed a preliminary prospectus for a spot XRP ETF, marking a significant step towards the launch of the world's first XRP exchange-traded fund (ETF). This move could potentially allow the company to establish XRP investment products ahead of many U.S. institutions.

Purpose Investments, which previously launched the first Bitcoin ETF in North America in 2021, aims to provide investors with a channel to participate in related asset investments without directly holding XRP. If approved, this ETF is expected to offer investors exposure to the cryptocurrency market through a more traditional investment vehicle.

The filing of the prospectus comes amidst the ongoing legal battle between the U.S. Securities and Exchange Commission (SEC) and Ripple, the company behind XRP. The SEC has argued that XRP is a security, while Ripple maintains that it is a currency. The outcome of this legal battle could have significant implications for the approval of XRP ETFs in the U.S.

Bloomberg analyst James Seyffart has warned that the SEC's legal battle with XRP could delay the approval of XRP ETFs. Seyffart believes that the SEC's stance on XRP as a security could make it difficult for ETF providers to gain approval for XRP-based products. However, he also noted that the SEC's recent approval of Bitcoin and Ethereum ETFs suggests that the agency is open to cryptocurrency-related products.

The Canadian ETF market has been more receptive to cryptocurrency products than its U.S. counterpart. In addition to Purpose Investments' Bitcoin ETF, several other Canadian asset management firms have launched or are planning to launch cryptocurrency ETFs. This trend could continue, as Canadian regulators have shown a more favorable stance towards cryptocurrencies compared to their U.S. counterparts.

The launch of an XRP ETF in Canada could have significant implications for the cryptocurrency market. It could provide investors with a more accessible and regulated way to gain exposure to XRP, potentially increasing demand for the cryptocurrency. Additionally, it could pave the way for other asset management firms to launch XRP ETFs in other jurisdictions, further legitimizing XRP as a viable investment option.

However, the ongoing legal battle between the SEC and Ripple could cast a shadow over the potential launch of an X