XRP News Today: SEC Approves XRP ETF as Commodity, Bypassing Security Classification Dispute

The U.S. Securities and Exchange Commission (SEC) has taken a significant step toward legitimizing XRP as an institutional asset by approving a spot XRP exchange-traded fund, according to reports from Kenny Nguyen and filings from Franklin Templeton. This development marks a pivotal moment for XRP, the fourth-largest cryptocurrency by market capitalization, as it opens the door for regulated exposure through traditional brokerage accounts. The ETF, titled the Franklin XRP Trust, will be issued by Franklin Templeton, a firm managing $1.6 trillion in assets, and is set to launch on the Cboe BZX Exchange under the ticker EZRP.

The approval process gained momentum after Franklin Templeton submitted an amended S-1 registration to the SEC, removing a delaying clause (Section 8(a)) that would have extended the review period. This change allows the ETF to become effective within 20 days unless the SEC intervenes. The fund's structure, which holds XRP via Coinbase Custody, avoids distributing airdrops or forks to shareholders, simplifying regulatory compliance and operational complexity. Coinbase Custody will safeguard the ETF's XRP holdings in cold storage, while Coinbase Inc. will act as the prime broker for trade execution.

Market participants view the ETF as a catalyst for institutional adoption. By enabling investors to trade XRP without directly holding the asset, the fund addresses custody risks that have historically deterred traditional investors from crypto markets. Analysts predict inflows could mirror the success of Bitcoin and Ethereum ETFs, which have attracted over $100 billion since 2024. Early signs of demand are evident: Canary Capital's XRPC ETF, launched on Nasdaq, generated $245 million in inflows on its first day. However, XRP's price has dipped nearly 11% since the ETF's debut, attributed to whale selling and broader market weakness.

The ETF's regulatory framework aligns with commodity-based models, treating XRP similarly to gold or oil under BZX Rule 14.11(e)(4). This classification contrasts with the SEC's ongoing litigation against Ripple Labs, which argues XRP should be deemed a security. Franklin's ETF sidesteps this debate by focusing on XRP's utility in cross-border payments and its growing institutional acceptance.

Despite optimism, risks remain. The SEC has not formally announced final approval, and regulatory scrutiny could still delay the launch. Additionally, XRP's price volatility and cybersecurity concerns underscore the need for caution. Franklin's prospectus highlights a 0.19% annual fee, waived initially, positioning the ETF competitively against similar products.

Investors are advised to monitor SEC filings and exchange announcements for confirmation of the ETF's effectiveness. If trading begins as scheduled on November 18, the product could redefine XRP's role in traditional finance, bridging crypto and institutional markets. For now, the milestone remains "anticipated" but underscores a broader trend of regulatory clarity and crypto integration.