XRP News Today: XRP ETF Approval Could Boost Ripple's Payments Token

Ripple, the company behind XRP and the XRPL ledger, has been in the spotlight as the U.S. approved its first spot Bitcoin and Ether exchange-traded funds (ETFs) on January 10, 2024. This approval signaled a significant shift in mainstream investor interest in accessing crypto through traditional brokerage accounts. The growth of Ethereum and Bitcoin ETFs has now turned attention to XRP, the payments-oriented digital asset created in 2012. Franklin Templeton’s proposed XRP spot ETF is currently under review by the Securities and Exchange Commission (SEC), with a first-deadline decision expected by June 17, 2025. Approval of this ETF could redefine how both retail traders and banks gain exposure to one of the world’s largest cryptocurrencies.

Ask Aime: Will Franklin Templeton's XRP ETF spot approval change retail investment dynamics?

XRP is the native token of the XRP Ledger (XRPL), an open-source blockchain designed for fast, inexpensive, and energy-efficient value transfer. A typical XRP transaction settles in three to five seconds at a cost of fractions of a cent, consuming far less electricity than proof-of-work networks such as Bitcoin. Ripple, the company that initially fostered XRPL development, markets XRP as a “bridge” asset that allows financial institutions to move liquidity across borders without locking capital in nostro accounts. The token’s trajectory has been influenced by both technical achievements and court filings. In 2020, the SEC accused Ripple of selling unregistered securities. A split ruling in July 2023 found that XRP sold on public exchanges was not a security, though certain institutional sales were. The agency appealed but withdrew its final challenge in March 2025, ending a four-year legal cloud and clarifying, if not fully codifying, XRP’s regulatory status in the United States.

An ETF, or Exchange-Traded Fund, is a type of investment fund traded on a stock exchange, similar to individual stocks. It is a basket of assets, like stocks, bonds, or commodities, that can be bought and sold during market hours. A spot ETF is a fund that holds the underlying asset itself, not futures or other derivatives. Authorized participants — large trading firms — create new ETF shares by delivering the asset to the fund’s custodian and redeem shares by taking the asset out, a mechanism that keeps the market price close to net asset value. For investors, that structure folds a once-esoteric commodity into the familiar wrapper of intraday-traded shares, complete with regulated custody, audited holdings, and simple tax reporting.

An XRP spot ETF would replicate that model with XRP. The sponsor would arrange institutional-grade cold storage for the tokens, while share creation and redemption would ensure the fund tracked spot-market prices. For anyone who already trades equities or bond funds, buying an XRP ETF would feel no different than purchasing an S&P 500 index fund. Yet, it would provide direct economic exposure to the token’s price movements without the technical and security hurdles of managing a crypto wallet.

First, the issuer files a rule-change proposal with a national securities exchange, in Franklin Templeton’s case. Once the SEC declares the filing effective, market-makers can deliver blocks of XRP to the custodian in exchange for “creation units,” which are then sliced into ETF shares and sold to the public. When shares drift below net asset value, arbitrage desks reverse the process, redeeming shares for XRP and restoring the price peg. To guard against manipulation, the ETF must benchmark itself to a reference index that aggregates prices from several high-volume exchanges and publish daily holdings reports. Third-party auditors attest to the wallet balances, and the custodian employs multi-signature controls, geographically distributed cold-storage vaults, and insurance coverage. Management fees are expected to fall somewhere between the sub-20-basis-point race now underway in Bitcoin ETFs and the higher costs typical of less liquid commodities.

Despite March 2025’s courtroom victory, XRP is not yet enshrined in statute as a commodity. A future SEC chair, or a new piece of legislation, could reopen the question, leaving a sliver of legal risk that does not exist for Bitcoin or Ether, which regulators have repeatedly described as non-securities. The SEC must also be satisfied that the XRP spot market has adequate depth and that leading exchanges will sign surveillance-sharing agreements to flag suspicious trading. This condition delayed Bitcoin ETFs for a decade. Finally, because several issuers are lining up with similar proposals, the Commission may seek extra public comment rounds, stretching the review timeline and introducing sequencing uncertainty.

A U.S.-listed XRP fund could unlock mainstream demand, enlarge order-book depth, and help Ripple’s banking partners transact in a more liquid asset pool. Most U.S. households already own ETFs through retirement plans or brokerage apps. Wrapping XRP in that structure removes the friction of crypto-exchange onboarding, private-key storage, and tax-lot calculations, widening the addressable market beyond tech-savvy traders. ETF creations and redemptions turn every subscription dollar into spot XRP purchases, funneling steady, transparent demand onto exchanges. Bitcoin’s experience is instructive: spot ETFs absorbed billions of dollars within their first month, tightening spreads and lifting volumes across venues. Because ETF sponsors publish daily wallet attestations and rely on regulated market-makers, investors gain a unified reference price instead of the fragmented quotes typical of global crypto exchanges. Over time, that transparency can reduce volatility premiums and improve the asset’s suitability for corporate treasury use.

Convenience does not erase the macro, legal, or operational uncertainties that still surround the asset. While the SEC withdrew its appeal in March 2025, the underlying split decision left room for future litigation over specific sales channels. Without comprehensive federal legislation, courts, not Congress, remain the arbiter of crypto status, and that judicial path can be unpredictable. XRP’s price has historically swung more than 70% in some calendar quarters. An ETF wrapper can amplify those moves because institutional inflows and outflows arrive in large, sometimes pro-cyclical blocks, potentially accelerating rallies and corrections. Institutional custody mitigates but does not eliminate risk. Sophisticated social-engineering attacks and supply-chain intrusions have compromised well-funded custodians in the past; any material breach could force trading halts or trigger costly insurance claims, affecting shareholders in ways unfamiliar to traditional equity investors.

Bitcoin ETFs position the asset as “digital gold,” a censorship-resistant store of value. Ether funds offer a stake in the dominant smart-contract platform. XRP, by contrast, targets the plumbing of cross-border payments. That functional difference appeals to banks and remittance processors but also means the token’s demand profile may be more sensitive to transaction-volume trends than to macro narratives about inflation hedges or decentralized finance. Liquidity is another distinction: XRP’s global spot volume lags far behind BTC and ETH, which could leave early-stage ETF spreads wider until the fund’s assets under management scale to critical mass. Fee dynamics will likely reflect that gap; sponsors bear higher per-unit custody costs when daily turnover is thinner.

Outside the United States, physically backed XRP products have traded for years. In Canada, Purpose Investments filed a preliminary prospectus in January 2025 to list the world’s first XRP ETF on the Toronto Stock Exchange, hoping to front-run U.S. approval. A green light from Washington would almost certainly trigger copy-cat launches across Asia and the Middle East, echoing the global domino effect that followed Bitcoin ETF approval.

An XRP spot ETF would extend crypto’s integration into the regulated financial system from “digital gold” and “smart-contract fuel” to a payments-centric asset. The wrapper promises friction-free retail access, deeper professional liquidity, and clearer price benchmarks, yet it also inherits XRP’s unresolved policy questions and ineradicable volatility. Investors weighing an allocation should balance those conveniences against the extra layers of legal and operational risk that accompany a still-maturing market.