XRP ETF: If Approved, New York Stock Exchange Will List

Bittime - On January 30, 2025, NYSE Arca submit a proposal to United States Securities and Exchange Commission (SEC) to register and trade shares Grayscale XRP Trust. If approved, the product would give investors regular access to XRP without having to purchase or secure the cryptocurrency directly.

What Is the Grayscale XRP Trust?

Grayscale XRP Trust is one of the largest XRP investment funds in the world with total assets under management of approx $16.1 million at the time of submission of this proposal. This fund is managed by Grayscale Investments Sponsors LLC and guarded by Coinbase Custody Trust Company LLC, temporary BNY Mellon Asset Servicing serves as a transfer agent. 

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If this proposal is approved, Grayscale XRP Trust will operate as a product XRP exchange-traded product (ETP), which allows its shares to be traded on national stock exchanges like other ETF products.

What are the Benefits of the Grayscale XRP Trust?

This project aims to provide investors an organized view of XRP without having to deal with the hassle of buying and storing cryptocurrency directly. This trust structure ensures that the assets consist solely of XRP, without any trading strategy or active management. 

This means that Grayscale XRP Trust will follow the market price of XRP without carrying out any activities focused on gaining profits from price changes.

How it Works and Asset Valuation

Shares traded will represent a proportional share of the trust's total XRP holdings, adjusted for fees. To value its assets, the trust will use Index Price which is calculated from major digital trading platforms such as Coinbase, Crypto.com, Kraken, LMAX Digital, And Bitstamp. The aim of using this index is to reduce the potential for fraud and price manipulation by filtering out possible price anomalies.

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Investor Supervision and Protection

NYSE Arca has established trading rules and supervisory measures to ensure compliance with SEC regulations and protect investors. Shares will be traded between 4:00 am to 8:00 pm ET, with real-time market data provided by Bloomberg, Reuters, and other financial service providers. To maintain market integrity, exchanges also introduce rules stop trading, transparency requirements, And protection for investors.

Impact on the Crypto Industry

If approved, launch Grayscale XRP Trust as a stock exchange-traded product would be a significant step in bringing XRP-based investment products to the mainstream. It will also provide a safer and more regulated alternative for crypto investors looking to gain exposure to XRP through a product overseen by regulators, making it more accessible to traditional investors who may be hesitant about investing directly in cryptocurrencies.

Conclusion

Grayscale XRP Trust can open up new opportunities for investors who are interested in XRP, but wanted a more organized and secure way to invest in these crypto assets. If NYSE Arca's proposal is approved by the SEC, this could be a major step in bringing cryptocurrency-based investment products to a wider market and more mainstream acceptance.

FAQ

What is the Grayscale XRP Trust?

The Grayscale XRP Trust is an investment fund that allows investors to gain exposure to XRP without having to purchase or hold the cryptocurrency directly.

What are the benefits of this product for investors?

Investors can access XRP through regulated and supervised products, avoiding the difficulties associated with purchasing and storing XRP directly.

How does the Grayscale XRP Trust ensure security and transparency?

Grayscale XRP Trust follows SEC regulations with strict oversight, trading rules, as well as price transparency through real-time data and the use of filtered price indices to reduce market manipulation.

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Reference

News Bitcoin, Wall Street Eyes XRP: Grayscale's XRP ETF Awaits SEC Green Light, accessed February 1, 2025.

Author: MF