TLDR
- SEC has begun reviewing Bitwise’s spot XRP ETF application alongside proposals from other major financial firms
- The complete review process could extend to 240 days with an initial 21-day public feedback period
- Current XRP price sits at $2.53, showing a 2.9% decrease despite ETF developments
- Analysts predict a 65% likelihood of XRP ETF approval after Bitcoin and Ethereum ETF successes
- Market experts caution about the need for strong institutional demand before launching new crypto ETFs
The U.S. Securities and Exchange Commission has begun processing a new wave of spot XRP exchange-traded fund applications, with Bitwise becoming the latest firm to join the race. The filing, made through Cboe BZX Exchange, adds to the growing list of financial companies seeking approval for XRP-based investment products.
Regulators will take up to 21 days to gather public feedback once Bitwise’s filing appears in the Federal Register. This marks the beginning of what could stretch into a 240-day review period before the SEC reaches its final decision.
The proposal from Bitwise arrives as other major players stake their claims in the XRP ETF space. Grayscale and 21Shares have already received SEC acknowledgment for their applications, while WisdomTree and Canary Capital await similar recognition for their proposals.
Each application outlines specific measures to protect investors and maintain market integrity. Bitwise’s proposal includes plans to source XRP pricing data exclusively from regulated U.S. trading platforms and implement strict creation and redemption procedures to prevent market manipulation.
The Trump administration’s approach to crypto regulation has created an environment where traditional financial institutions feel more confident exploring digital asset investment products. This shift follows the successful introduction of Bitcoin and Ethereum ETFs to the market.
ETF specialists at Bloomberg, James Seyffart and Eric Balchunas, have positioned XRP ETFs as having a 65% chance of receiving regulatory approval. Their analysis suggests growing momentum for crypto investment products in conventional financial circles.
The Race for XRP ETFs
Market reaction to these developments remains measured, with XRP’s price currently at $2.53, reflecting a 2.9% decline according to CoinGecko data, despite the expanding ETF landscape.
Cboe Exchange has emerged as a central player in the push for XRP ETFs, filing four separate proposals with the SEC. These applications represent products from WisdomTree, Bitwise, 21Shares, and Canary, highlighting the financial industry’s interest in launching the first U.S. spot XRP ETFs.
Industry experts have raised important considerations about the rapid expansion of crypto ETFs. Sygnum Bank’s Head of Research, Katalin Tischhauser, emphasizes that not every cryptocurrency warrants an ETF product, pointing to the necessity of robust institutional demand.
The proposed ETFs would incorporate creation and redemption mechanisms designed to ensure accurate pricing. These systems allow authorized participants to exchange ETF shares for the underlying XRP, helping maintain price alignment with the cryptocurrency’s market value.
An approved XRP ETF would create a regulated channel for investors to gain exposure to the third-largest cryptocurrency without direct ownership. This structure appeals to traditional investors who prefer working within established financial systems.
The SEC’s review process examines multiple aspects of each application, including market oversight, asset custody arrangements, and investor safeguards. Regulators must verify that each proposal includes adequate measures to prevent fraud and maintain orderly trading.
Tischhauser warns about the risks associated with lower-volume tokens, noting their potential for increased price swings. Such volatility could result in losses beyond typical institutional risk tolerances, potentially affecting demand for crypto ETF products.
These applications represent continued evolution in the cryptocurrency investment landscape. The SEC’s decisions will depend on how well each proposal addresses regulatory requirements and investor protection standards.
The current stage of review focuses on Bitwise’s application, which awaits Federal Register publication to start its formal evaluation period. This filing joins the queue of proposals that could reshape cryptocurrency investment options.
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