In a significant development for the cryptocurrency landscape, the U.S. Securities and Exchange Commission (SEC) has embarked on the formal review of the WisdomTree XRP Trust—a proposed spot exchange-traded fund (ETF) designed to offer investors a more traditional avenue to engage with XRP. This marks the first time the SEC has considered a U.S.-based spot XRP ETF, a move that could pave the way for similar products tied to other digital assets.
A New Chapter for XRP
The filing, submitted by the Cboe BZX Exchange, seeks to track the market price of XRP through the CME CF Ripple-Dollar Reference Rate, providing investors exposure without the complications of managing private keys or self-custody. This ETF could serve as a bridge for traditional investors into the world of cryptocurrency, potentially demystifying digital assets for a broader audience. As explored in our recent coverage of Nasdaq’s pursuit of SEC approval for the 21Shares Dogecoin ETF, the interest in crypto ETFs is gaining momentum across various digital currencies.
The SEC’s notice, identified as Release No. 34-103124, marks the beginning of an intensive 240-day evaluation period during which the Commission will decide whether to greenlight or reject the application. Throughout this process, the agency is actively soliciting public feedback on the ETF’s structural integrity—particularly concerning market manipulation and investor protection mechanisms.
Ripple’s Strategic Posture
In a parallel development, Ripple’s Chief Legal Officer, Stuart Alderoty, has made a compelling argument to the SEC’s crypto taskforce, emphasizing that XRP should not be classified as a security. “Rules must be clear not just for issuers, but for all market participants who could be unwittingly classified as securities exchanges, brokers, dealers, or issuers,” Alderoty noted. His comments underscore the persistent regulatory ambiguity plaguing the crypto sector, which often leans on nebulous terms such as “fully functional” or “decentralized”—terms that Alderoty argues contribute more to confusion than clarity.
This dialogue occurs in a broader context where the SEC’s stance on cryptocurrencies remains a central issue. Past skirmishes between Ripple and the SEC have already set a precedent in the ongoing debate over the regulatory treatment of digital assets. Ripple has historically asserted that XRP, in its current form, should not fall under the same regulatory umbrella as traditional securities—a position that, if accepted, could reshape the regulatory landscape for other cryptocurrencies.
Potential Ripple Effects
The implications of an approved XRP spot ETF are manifold. For one, it could catalyze a wave of similar financial products, each offering different digital assets in a more accessible format. Industry experts suggest that such a transition could significantly bolster market liquidity, offering a unique opportunity for diversification within traditional investment portfolios. This trend is mirrored in other areas of the crypto market, as seen in Litecoin’s recent surge following speculation about the SEC’s potential approval of a spot ETF.
However, it’s not all smooth sailing. The prospect of an XRP ETF raises questions about the broader implications for market stability and the potential for new regulatory challenges. “There’s a delicate balance to be struck here,” says crypto analyst Jenna Matthews. “On one hand, the introduction of an XRP ETF could democratize access to digital currencies. On the other, it could expose traditional markets to new forms of volatility.”
The Road Ahead
As we look to the future, the SEC’s ultimate decision on the WisdomTree XRP Trust will likely serve as a bellwether for the industry’s regulatory trajectory. While the market awaits a verdict, stakeholders are keenly watching the SEC’s actions—every move dissected for clues about how the regulatory body might approach other crypto-related financial products.
In the meantime, the dialogue between Ripple and the SEC continues to unfold, shaping both the present and future of cryptocurrency legislation. Whether the WisdomTree XRP Trust will become a reality remains an open question, one that hinges not only on regulatory approval but on broader market acceptance and adaptation.
As the clock ticks down on the SEC’s 240-day review period, the crypto community can only speculate on the potential outcomes—and their far-reaching impacts.
Source
This article is based on: XRP Spot ETF in the U.S. Moves Closer to Reality
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
