SEC Acknowledges Bitwise’s Spot XRP ETF Filing Adding to a Crowded List – Decrypt

On Tuesday, the U.S. Securities and Exchange Commission acknowledged the filing for Bitwise’s spot XRP exchange-traded fund submitted by Cboe BZX Exchange, becoming the latest in a string of issuers vying to front run anticipated policy shifts to crypto under the Trump administration.

If approved, Bitwise’s spot XRP ETF would legitimize XRP as a mainstream investment vehicle, offering a regulated option for exposure to the world’s third-largest crypto.

Once published in the Federal Register, the SEC will allow a 21-day comment period on the filing before deciding to approve, deny, or pursue further action, with a final decision expected in up to 240 days.

The acknowledgment follows similar moves by other firms, with the SEC recently acknowledging XRP ETF proposals from Grayscale and 21Shares. Filings from WisdomTree and Canary Capital still remain under review.

The increasing number of crypto ETF filings and the SEC’s responsiveness to these applications suggest regulators are on the cusp of a new phase in the acceptance of digital assets under President Donald Trump’s administration.

The SEC’s decision will depend on public feedback and the filing’s compliance with its investor protection standards. 

As of now, XRP remains down 2.9%, trading at $2.53, as per CoinGecko data, despite the increasing optimism surrounding crypto ETFs.

The SEC is also reviewing Bitwise’s plan to manage the trust’s assets and mitigate manipulation risks.

This includes safeguards like sourcing XRP prices from U.S.-compliant trading platforms and implementing a creation and redemption process to help prevent fraud.

Following the successful launch of Bitcoin and Ethereum ETFs, chatter about ETFs for other digital assets, including Litecoin, XRP, and Solana, has skyrocketed. 

Bloomberg ETF analysts James Seyffart and Eric Balchunas have given XRP ETFs a 65% chance of approval, a favorable outlook for the product amid rising interest in crypto-based investment vehicles.

However, Katalin Tischhauser, Head of Research at Sygnum Bank, has cautioned that not all tokens are created equal, and not all tokens merit an ETF. 

“With much of the crypto market seen as speculative or hype-driven, healthy demand is needed for institutional investors to make an allocation,” Tischhauser told Decrypt.

Tischhauser said if many new ETFs are launched without significant demand, the market could be disappointed, potentially damaging the broader crypto industry. 

“Tokens with lower volumes are subject to higher volatility, which could lead to larger losses than institutional investors are used to, she explained. “This could diminish the demand for access to additional crypto assets.” 

While there is increased interest in crypto ETFs, launching them is a “double-edged sword” and requires careful consideration, Tischhauser remarked.

Edited by Sebastian Sinclair