Grayscale has reignited XRP, launching a new trust despite SEC clashes.

Grayscale’s new XRP Trust has sparked speculation about a potential ETF.

The market has surged as Grayscale’s Trust has sent XRP volumes soaring.

Grayscale Investments has shaken up the crypto landscape by launching the Grayscale XRP Trust, giving accredited investors exposure to XRP without the headaches of direct purchase and custody.  Sponsored

Announced on September 12, this trust offers accredited investors a way to dive into XRP without the usual hassles of direct ownership. The launch not only ramps up XRP’s accessibility but also ignites speculation about a potential XRP exchange-traded fund (ETF)—though Grayscale hasn’t officially confirmed such a plan.

Grayscale Re-enters XRP Market

This bold re-entry into the XRP market follows a rocky history. In 2021, Grayscale shuttered its original XRP Trust amid the SEC’s $1.3 billion lawsuit against Ripple, the company behind XRP. Back then, Grayscale liquidated all its XRP holdings, blaming U.S. investors’ difficulty in converting XRP to USD. 

With the new trust, Grayscale is signaling a renewed faith in XRP despite ongoing regulatory scrutiny. Grayscale’s recent success in turning its Bitcoin and Ether trusts into ETFs only fuels speculation about an XRP ETF. 

While trusts navigate fewer regulatory obstacles, ETFs are under the watchful eye of the SEC. By implementing the XRP Trust, Grayscale might be testing the waters for a future clash with regulators.

XRP Price Surges on Grayscale News

The XRP Trust is rolling out in Grayscale’s signature four-phase process. Currently in the private placement stage, it’s open to accredited investors only, with shares locked for a year. The trust will soon enter the public quotation phase, opening up to all investors and removing restrictions on investment amounts and holding periods. 

Grayscale cautions that shares could trade at a premium or discount to XRP’s true value. The third phase will see increased transparency through SEC reporting, reducing the private placement lock-up period to six months. 

The final phase might bring an ETF or similar exchange-traded product, aligning the trust with regulated investment vehicles and introducing ongoing creation and redemption mechanisms. The market responded with enthusiasm. 

XRP’s price shot up 8% to around $0.56, reversing earlier losses, while trading volumes surged by over 70%, topping $1.5 billion. This reaction highlights the market’s excitement and underscores the potential impact of Grayscale’s move on investor sentiment and market dynamics.

On the Flipside

The Grayscale XRP Trust is initially available only to accredited investors, excluding the general public from early participation.

Despite positive sentiments, XRP and Ripple continue to face regulatory scrutiny from the SEC.

There is no assurance that the Grayscale XRP Trust will be converted into an ETF, and regulatory hurdles could prevent such a transition.

Why This Matters

The launch of the XRP Trust signals a significant institutional endorsement of XRP despite lingering regulatory uncertainties. This could potentially accelerate mainstream adoption and pave the way for an XRP ETF. This move could reshape investor sentiment across the crypto market, attracting both institutional and retail interest and influencing market dynamics.

While Ripple’s XRP has been making waves in the institutional world, some believe it’s falling short for DeFi and retail investors; read more about it here:Ripple’s XRP Falling Short in DeFi and Retail—What’s the Issue?Ripple’s new stablecoin, RLUSD, is designed for institutions, not for everyday investors. Curious about the future of stablecoins and Ripple’s plans for RLUSD? Read more here:Why Ripple’s RLUSD Stablecoin Could Be Off-Limits for Us Plebs