Asset manager WisdomTree has filed for a trust entity in Delaware, taking the first step towards launching an exchange-traded fund (ETF) focused on XRP. If approved, the ETF would track XRP’s price, providing institutional investors with more access to digital assets. This move follows a trend of crypto-focused ETFs creating new investment opportunities in the market. XRP reacted positively to the news, with its price increasing by almost 7% over the past 24 hours to $1.47.
Despite this positive development, XRP’s journey to becoming an ETF-backed asset faces legal and regulatory challenges. Ripple Labs, the issuer of XRP, is currently in a legal dispute with the US Securities and Exchange Commission (SEC) over allegations that XRP was sold as an unregistered security. Although Ripple scored a partial legal victory in 2023, with a ruling that retail XRP sales did not violate securities laws, the SEC has appealed the decision, keeping regulatory uncertainty in play. Ripple CEO Brad Garlinghouse remains optimistic about XRP ETFs, citing strong demand and the billions flowing into Bitcoin ETFs since their launch earlier this year.
The recent resignation of SEC chair Gary Gensler following the US elections has raised hopes that the new administration will bring an end to the regulatory uncertainty that has hindered the industry’s growth in the US. WisdomTree, overseeing $113 billion in assets, joins other firms in seeking approval for XRP ETFs, reflecting a broader trend of expanding the crypto ETF landscape. Other recent ETF proposals include Bitwise’s application for a Solana ETF and 21Shares’ proposal for the 21Shares Core XRP Trust.
Analysts see these filings as strategically meeting institutional demand while waiting for clearer regulatory frameworks. The ETF Store President Nate Geraci believes WisdomTree’s move demonstrates foresight in the evolving crypto adoption landscape. As cryptocurrencies gain traction in mainstream finance, ETFs provide a way for institutional investors to access digital assets. The launch of Bitcoin ETFs earlier this year marked a significant moment in the industry, with substantial inflows highlighting the appeal of these products. However, the approval of XRP ETFs hinges on resolving Ripple’s legal challenges, as the broader market continues to navigate a complex regulatory environment. Firms like WisdomTree are positioning themselves for future opportunities in the space.
