21Shares Files for Spot XRP ETF Amid Growing Demand

Crypto asset manager 21Shares plans to launch an exchange-traded fund (ETF) linked to the spot price of XRP, the native token of the payments-focused Ripple blockchain.

21Shares Files for Spot XRP ETF

On November 1, the company filed an S-1 registration form with the United States Securities and Exchange Commission (SEC) to launch a spot XRP ETF in the country. According to the filing, 21Shares plans to launch the XRP-backed product on Cboe BZX Exchange.

Dubbed 21Shares Core XRP Trust (the “Trust”), the investment vehicle’s performance will be tracked using the CME CF Ripple—Dollar Reference Rate. The filing stated that it would not utilize “leverage, derivatives or any similar arrangements in seeking to meet its investment objective.”

21Shares has become the third investment firm to file for a spot XRP ETF application. Last month, Canary Capital and Bitwise filed their applications, indicating a growing demand for crypto investment products among asset management firms.

Notably, 21Shares is also seeking approval to launch an ETF tied to the spot price of Solana’s SOL.

Will the SEC Approve?

The approval of 21Shares’ spot XRP ETF will depend on multiple factors, such as the classification of the digital asset. Ripple Labs and SEC are still in an ongoing legal dispute over the classification of XRP. While Ripple secured a significant victory when a US Judge ruled that XRP is not a security, she noted that the institutional sale of the digital asset constituted a securities law violation.

The SEC’s argument that XRP is a security is based on the Howey Test principle, which determines whether a transaction qualifies as an investment contract.

Meanwhile, some industry leaders have shown optimism toward approving a spot XRP ETF in the US. In a recent appearance at the Washington DC Fintech Week, Ripple CEO Brad Garlinghouse stated that approving a spot XRP ETF is inevitable. Garlinghouse believes a new leadership in the White House will play a significant role in this effort.

XRP traded at $0.5155 at press time, representing a 2.4% surge on the day.