XRP Spot ETF in the U.S. Approaches Reality

The Securities and Exchange Commission (SEC) has begun a formal assessment of the WisdomTree XRP Trust, a proposed spot exchange-traded fund (ETF) aimed at giving investors the chance to engage with XRP.

Submitted by the Cboe BZX Exchange, this application represents the first official SEC review of a spot XRP ETF in the United States. If granted approval, it would become the inaugural spot XRP ETF in the nation, potentially paving the way for similar financial products linked to other cryptocurrency assets.

This offering aims to reflect the market value of XRP through the CME CF Ripple-Dollar Reference Rate, allowing consumers to invest in XRP using conventional brokerage accounts, eliminating the necessity for private key management or self-custody solutions.

The SEC has issued its notice under Release No. 34-103124, commencing a comprehensive examination of the proposal. The agency has a timeframe of up to 240 days to either approve or decline the application.

During this period, the SEC is also encouraging public feedback regarding whether the structure of the ETF sufficiently mitigates concerns related to market manipulation and the safeguarding of investors.

In a recent letter to the SEC’s cryptocurrency taskforce, Ripple’s Chief Legal Officer, Stuart Alderoty, reaffirmed his stance that XRP should not be classified as a security by itself.

“Regulations must be distinctly defined not only for those issuing but also for all market participants who might inadvertently be categorized as securities exchanges, brokers, dealers, or issuers,” Alderoty stated, emphasizing that excessive reliance on ambiguous phrases such as “fully functional” or “decentralized” only leads to greater regulatory ambiguity rather than offering clarity.