New Grayscale XRP Trust could lead to ETF approval

Grayscale Investments has launched a new investment trust tied to XRP, offering accredited investors exposure to the cryptocurrency. The Grayscale XRP Trust operates similarly to the firm’s other single-asset investment vehicles and is aimed at institutional and individual investors. Although this is not an exchange-traded fund (ETF), the trust’s creation is seen as a potential stepping stone towards the eventual approval of an XRP ETF by the US Securities and Exchange Commission (SEC).

Grayscale has outlined a four-phase product life cycle for the XRP Trust, which could ultimately lead to the trust being converted into an ETF. While a trust faces fewer regulatory hurdles, an ETF requires SEC approval and is aimed at retail investors. The potential for an XRP ETF has generated interest, particularly given XRP’s role in cross-border payments and its transformative potential for the global financial system.

Grayscale’s head of product and research, Rayhaneh Sharif-Askary, highlighted XRP’s real-world applications, specifically in making international payments more efficient. The XRP Ledger, a decentralised blockchain, plays a key role in enabling fast and cost-effective cross-border transactions, which Grayscale believes could revolutionise outdated financial systems.