Today, two major ETF issuers have advanced XRP-based asset initiatives. Grayscale has launched trading of the XRP Trust Fund, and 21Shares has filed an official application for an XRP ETF.
Grayscale's trust fund has the potential to be converted into an ETF, but the long-term customer appeal is uncertain.
XRP ETF Competition
Grayscale announced that the XRP Trust is open to qualified investors. This trust, launched two months ago, is seen as a precursor to an ETF. Grayscale has previously converted its Bitcoin Trust into an ETF and is currently working to convert other funds into ETFs.
"The Grayscale XRP Trust (the 'Trust') is one of the first securities that derives value from and invests in XRP... It avoids the challenges of directly purchasing, storing, and safeguarding XRP. The Trust's shares are designed to track the market price of XRP," the company claimed on its website.
Read more: XRP ETF Guide: What Is It and How Does It Work?
The possibility of an XRP ETF is growing in the cryptocurrency space. Ripple's CEO has said that regulatory approval is "inevitable", and several companies have already submitted their own petitions. Grayscale's non-ETF trust strategy has been reliable in the past and enabled early gains. However, this loose structure also has drawbacks: the price of the XRP Trust actually dropped when trading began.
Grayscale's Bitcoin Trust (GBTC) was an early leader in the ETF market, but it has quickly lost ground to younger competitors. The company has even gone as far as launching a second Bitcoin-based ETF to try to regain market share. Grayscale's pre-ETF trust fund strategy may have allowed early market access, but customers may migrate to dedicated ETF products.
If the SEC approves an XRP ETF in the near future, Grayscale will face significant competition. According to the filed documents, investment firm 21Shares is also jumping into the competition. 21Shares is already an issuer of Bitcoin ETFs and has petitioned for a Solana ETF as well. The competition is heating up, and this could reshape the face of Ripple.
Read more: Ripple (XRP) Price Prediction 2024/2025/2030
Ultimately, the SEC remains very quiet on the likelihood of approving such products. Once the Commission officially confirms or rejects these applications, it will be bound by a series of deadlines. That is, it must either proceed with the efforts or clearly block them. For now, this ambiguity still persists, and there are no signs of movement.
