Grayscale and Bitwise amend XRP ETF proposals
Grayscale Investments and Bitwise Asset Management have recently filed amendments to their proposals for spot XRP exchange-traded funds (ETFs), signaling a renewed push to bring XRP-based investment products to U.S. markets. These amendments, submitted to the U.S. Securities and Exchange Commission (SEC), reflect strategic updates that align with evolving regulatory expectations and market conditions. Both firms are positioning themselves at the forefront of what could become a pivotal moment for the institutional adoption of XRP.
Grayscale’s amended filing demonstrates a more robust framework for custody, market surveillance, and investor protection mechanisms, which are critical components in gaining SEC approval. The firm is leveraging its experience in navigating the ETF approval process, having recently secured regulatory clearance for its Grayscale Bitcoin Trust to convert into a spot Bitcoin ETF. This track record adds credibility to its XRP ETF ambitions and signals to investors that Grayscale is fully committed to expanding its crypto ETF offerings.
Bitwise, known for its data-driven approach and transparency in crypto fund management, has also updated its XRP trust proposal to reflect enhanced liquidity provisions and clearer disclosures regarding XRP’s legal and regulatory status. The amended filing includes a detailed analysis of XRP’s market structure, trading volume distribution across major exchanges, and mechanisms for price discovery—critical factors for the SEC when assessing potential market manipulation risks.
The updated filings from both firms are widely seen as a response to the growing momentum behind spot crypto ETFs following the landmark approval of Bitcoin spot ETFs earlier this year. These amendments suggest that Grayscale and Bitwise are not only responding to investor demand but are also proactively addressing the SEC’s historical concerns around transparency, custody, and market manipulation.
For investors and traders, these developments offer a “very good sign” that XRP may soon be available through regulated, institutional-grade investment vehicles. This could open the door for broader adoption of XRP among retail and institutional investors alike, potentially driving increased liquidity and price discovery in the XRP market. It also implies a maturing regulatory landscape where digital assets like XRP can be integrated into traditional financial products, offering new avenues for portfolio diversification and profit generation.
As the race to launch the first spot XRP ETF heats up, Grayscale and Bitwise are clearly staking their claim early, signaling to the market that XRP is ready to join Bitcoin and Ethereum in the ETF arena. For crypto investors watching for the next major catalyst, these amended filings represent a crucial step forward.
Regulatory context and SEC engagement
The regulatory environment surrounding cryptocurrency ETFs remains one of the most critical factors influencing their approval and success, and the case of XRP is no exception. The U.S. Securities and Exchange Commission (SEC) has historically taken a cautious, and at times adversarial, stance on digital assets—particularly those that fall outside of Bitcoin and Ethereum. XRP’s regulatory journey has been especially contentious, marked by the SEC’s high-profile lawsuit against Ripple Labs in 2020, which alleged that XRP was an unregistered security. While the legal battle has seen favorable rulings for Ripple in certain aspects, the case remains partially unresolved, and this lingering uncertainty has influenced how the SEC evaluates XRP-related financial products.
However, recent developments suggest a shift in regulatory posture. The SEC’s approval of spot Bitcoin ETFs in early 2024 marked a significant turning point, setting a precedent for how the agency may approach other digital assets. This has emboldened asset managers like Grayscale and Bitwise to move forward with XRP ETF proposals, banking on the momentum created by the Bitcoin ETF approvals and the evolving legal clarity around XRP. Notably, the SEC’s acceptance of amended filings into the review process indicates a willingness to engage with the proposals seriously, rather than dismissing them outright as in previous years.
The amendments filed by Grayscale and Bitwise have been tailored to align with the SEC’s stated criteria for ETF approval. These include comprehensive surveillance-sharing agreements with crypto exchanges, stringent custody arrangements with qualified custodians, and detailed disclosures of market structure. Importantly, the filings also address the SEC’s concerns around market manipulation—a key point of contention in past crypto ETF rejections. By including granular data on XRP trading volumes, exchange concentration, and price discovery mechanisms, these filings aim to preemptively resolve regulatory objections.
Industry observers note that the SEC’s current engagement with these proposals represents a more nuanced approach to digital asset regulation. Rather than issuing blanket rejections, the agency appears to be assessing each proposal on its merits, particularly in light of judicial rulings that have limited the SEC’s ability to broadly classify all crypto assets as securities. This regulatory recalibration may be creating a more favorable environment for XRP-based financial products to gain approval.
For investors and traders, understanding the regulatory context is essential in evaluating the potential of an XRP ETF. A green light from the SEC would not only validate XRP’s legal status but also pave the way for increased institutional participation. Moreover, the SEC’s engagement with these filings signals to the market that digital assets are gradually being integrated into the existing regulatory framework, reducing perceived risks and enhancing investor confidence.
As the review process unfolds, market participants should monitor SEC comment periods, public feedback, and any further legal developments involving Ripple and XRP. These factors will likely influence the agency’s final decision, and staying informed can provide traders with a strategic edge in positioning their portfolios ahead of potential market-moving announcements.
Market reaction to XRP ETF developments
The crypto market has responded swiftly and decisively to the news of amended XRP ETF filings by Grayscale and Bitwise, with XRP itself experiencing a notable surge in both price and trading volume. Following the announcement, XRP saw a double-digit percentage increase within 24 hours, reflecting renewed investor optimism that a spot XRP ETF could soon gain regulatory approval in the U.S. This price movement underscores the market’s sensitivity to institutional-grade developments and the broader implications for mainstream adoption of XRP.
Beyond the price action, on-chain metrics and exchange activity provide further evidence of heightened investor interest. According to data from CoinMetrics and Kaiko, XRP’s trading volume on U.S.-regulated exchanges such as Coinbase and Kraken spiked significantly, while open interest in XRP futures contracts rose sharply on platforms like Binance and Bybit. This uptick in derivatives activity suggests that both retail and institutional traders are positioning themselves ahead of a potential catalyst event—namely, the SEC’s approval of a spot XRP ETF.
Liquidity in XRP trading pairs also improved, with tighter spreads and deeper order books indicating greater market efficiency and confidence. Market makers appear to be re-engaging with XRP in anticipation of increased demand, especially from institutional investors who have traditionally been sidelined due to regulatory ambiguity. If a spot ETF is approved, it could act as a bridge for pension funds, family offices, and asset managers to gain exposure to XRP without navigating the complexities of direct crypto custody.
The broader crypto market has also reacted positively, interpreting the move as yet another sign that digital assets are gaining legitimacy in traditional finance. Bitcoin and Ethereum, while not directly impacted by the XRP ETF news, saw minor upward momentum as investors speculated that approval of an XRP ETF could pave the way for similar products tied to other altcoins. This sentiment aligns with the market’s reaction following the approval of Bitcoin spot ETFs earlier in 2024, which triggered a rally across the entire crypto asset class.
Social sentiment analysis from platforms like LunarCrush and Santiment indicates a sharp rise in XRP-related engagement across social media, forums, and trading communities. Keywords such as “XRP ETF,” “Grayscale,” and “Bitwise” trended across multiple platforms, signaling growing retail interest. This surge in attention often precedes increased capital inflows, particularly from retail investors looking to front-run institutional demand.
Furthermore, XRP’s price correlation with Bitcoin has slightly decreased in the wake of the ETF news, which may suggest that investors are beginning to view XRP as a potentially independent investment thesis rather than merely a proxy for broader crypto market movements. This decoupling could signal a maturing market dynamic where altcoins with strong narratives and institutional backing can chart their own price trajectories.
For traders and investors seeking actionable insights, the current market reaction presents both short-term and long-term opportunities. In the short term, volatility around XRP is likely to remain elevated, offering potential gains for swing traders and options traders capitalizing on price swings. In the longer term, if ETF approval materializes, XRP could benefit from sustained capital inflows, similar to the patterns observed with Bitcoin ETFs, which saw billions in net inflows within weeks of their launch.
Investors should also watch for developments in fund flows and institutional sentiment. If large asset managers begin to allocate to XRP via ETFs, it could validate XRP as a core holding in diversified crypto portfolios. This shift could also drive demand for XRP-related structured products, lending platforms, and staking services—each offering additional revenue streams for savvy investors.
As the XRP ETF narrative continues to unfold, market participants who remain agile and well-informed will be best positioned to capitalize on this evolving opportunity. Risk management remains key, but the market’s reaction so far indicates that investor appetite for regulated XRP exposure is strong and growing.
Implications for other cryptocurrency ETFs
The recent momentum behind the XRP ETF proposals by Grayscale and Bitwise is not only a milestone for XRP itself but also a potential catalyst for a broader wave of altcoin-focused exchange-traded funds. The willingness of the SEC to engage with these amended filings—especially following the landmark approval of spot Bitcoin ETFs—signals a changing regulatory landscape that could open the door for a new generation of crypto ETFs centered on digital assets beyond Bitcoin and Ethereum.
For investors and fund managers, this development represents a strategic inflection point. The crypto ETF market has long been dominated by Bitcoin and Ethereum due to their perceived regulatory clarity and deep market liquidity. However, the growing institutional interest in alternative assets like XRP suggests that the market is maturing and diversifying. If XRP manages to secure ETF approval, it could set a precedent for other digital assets with sizable market capitalization and robust ecosystems—such as Solana (SOL), Cardano (ADA), and Avalanche (AVAX)—to be considered viable candidates for similar products.
This potential shift has important implications for portfolio construction and asset allocation strategies. Traditional investors, who have so far limited their crypto exposure to BTC and ETH, may begin to explore altcoin ETFs as a means to enhance returns and diversify risk. The emergence of regulated vehicles for altcoins could facilitate this shift, making it easier for institutions to comply with fiduciary and compliance requirements while gaining access to high-growth digital assets.
Moreover, the success or failure of XRP ETF proposals will likely influence how asset managers approach the development of future crypto-based financial products. A green light from the SEC on XRP could embolden firms like VanEck, ARK Invest, and Fidelity to revisit or expand their ETF plans for other altcoins. Conversely, a rejection—particularly one grounded in issues like market manipulation or insufficient surveillance—may lead to more cautious strategies, with firms focusing on enhancing transparency and regulatory alignment before resubmitting.
From a technical standpoint, the XRP ETF process is also serving as a testing ground for the SEC’s evolving standards on liquidity, custody solutions, and market surveillance. The frameworks proposed by Grayscale and Bitwise—such as detailed liquidity analyses, partnerships with regulated custodians, and data-driven market surveillance agreements—could become templates for future filings involving other cryptocurrencies. This standardization would streamline the approval process and reduce uncertainty for both issuers and investors.
For crypto traders, the ripple effect of an XRP ETF approval could be significant. Altcoins with similar characteristics—large user bases, active developer communities, and established trading infrastructure—may experience speculative inflows in anticipation of their own ETF narratives. This could create short- to mid-term trading opportunities, particularly in assets that are already on the radar of institutional investors.
Additionally, the potential for multi-asset crypto ETFs becomes more viable as the range of approved underlying assets expands. Funds that combine exposure to Bitcoin, Ethereum, XRP, and other altcoins could offer a more balanced risk-reward profile, appealing to both retail and institutional investors seeking diversified crypto exposure. Such products would also foster greater capital efficiency and reduce the complexity of managing multiple single-asset positions.
The broader implication is a gradual normalization of crypto assets within traditional financial markets. As ETFs become available for a wider array of digital assets, cryptocurrencies will increasingly be viewed through the lens of traditional asset classes—subject to similar metrics of performance, risk, and correlation. This evolution will likely attract new capital from sectors of the market that have so far remained on the sidelines, including pension funds, endowments, and sovereign wealth funds.
Ultimately, while XRP is currently at the forefront of this movement, the implications extend far beyond a single asset. The progression of XRP ETF proposals could act as a bellwether for how quickly and extensively altcoins are integrated into mainstream financial instruments. For investors and traders, staying ahead of this curve—by identifying which assets are likely to follow XRP’s path—could unlock significant alpha in the coming months and years.
Expert opinions on XRP ETF prospects
Industry experts are closely watching the evolving narrative around spot XRP ETFs, with many viewing the recent amendments by Grayscale and Bitwise as a pivotal development that could reshape the digital asset investment landscape. According to several analysts and institutional stakeholders, the likelihood of SEC approval for an XRP ETF has increased significantly, though key regulatory and legal hurdles remain.
James Seyffart, ETF analyst at Bloomberg Intelligence, noted in recent commentary that the SEC’s willingness to accept the amended XRP ETF proposals into the formal review process is “a very good sign” for the broader altcoin ETF market. He emphasized that while XRP’s legal status is still partially unresolved, the agency’s engagement demonstrates a meaningful shift from its historically rigid stance on non-Bitcoin crypto assets. “This is the most constructive engagement we’ve seen from the SEC on an altcoin ETF proposal,” Seyffart remarked. “It suggests they’re at least open to the conversation, which is a departure from their prior approach.”
Cathie Wood, CEO of ARK Invest, echoed this sentiment during a recent fintech conference, explaining that the approval of Bitcoin spot ETFs has opened the regulatory floodgates for other digital assets. While ARK Invest has not yet filed for an XRP ETF, Wood acknowledged that XRP’s strong community, deep liquidity, and growing institutional interest make it a viable candidate for future ETF inclusion. “If we see regulatory clarity and a robust market structure, there’s no reason why XRP couldn’t follow a similar path to Bitcoin,” she said.
Legal experts also weigh in on the XRP ETF’s prospects through the lens of Ripple Labs’ ongoing litigation with the SEC. John Deaton, a prominent crypto attorney and advocate for XRP holders, believes that the partial legal victories Ripple has secured—particularly the court’s ruling that XRP is not a security when sold on secondary markets—provide a solid foundation for ETF approval. “The legal clarity is not absolute, but it’s enough to argue that XRP can be treated similarly to Bitcoin and Ethereum in the context of a spot ETF,” Deaton explained on his CryptoLaw podcast. “That should give the SEC sufficient confidence to approve a well-structured XRP ETF.”
From a market infrastructure standpoint, experts highlight the readiness of the XRP ecosystem to support an ETF product. Meltem Demirors, Chief Strategy Officer at CoinShares, pointed out that XRP has long had the technical attributes suited for institutional-grade products: fast settlement times, low transaction costs, and a mature trading ecosystem. “XRP already has the plumbing in place,” Demirors stated. “What’s been missing is regulatory clarity, and we’re finally seeing progress on that front.”
Institutional investors are also expressing growing interest in XRP as a portfolio diversification tool. A recent survey by Fidelity Digital Assets found that nearly 30% of institutional respondents are actively exploring exposure to altcoins beyond BTC and ETH, with XRP ranking among the top considerations. According to Chris Kuiper, Director of Research at Fidelity Digital Assets, “The appetite for diversified crypto exposure is there. As soon as regulatory uncertainty declines, we expect significant capital inflows into altcoin ETFs, with XRP leading the charge.”
Despite the optimism, some caution that the SEC’s decision-making process could still be influenced by political and legal considerations. Kristin Smith, Executive Director of the Blockchain Association, warned that while the amended filings are promising, approval is not guaranteed. “The SEC is under pressure to demonstrate consistency in its regulatory approach, especially after the court rulings involving Ripple,” Smith said. “But internal politics and interagency coordination may still delay or complicate the approval timeline.”
Nevertheless, the consensus among market experts is that the tide is turning in favor of broader crypto ETF adoption, and XRP is well-positioned to be among the first altcoins to benefit. For crypto investors and traders, these expert insights reinforce the strategic importance of monitoring XRP ETF developments closely. Should approval materialize, it could serve as both a validation of XRP’s legitimacy and a powerful catalyst for price appreciation and institutional adoption.
As the SEC continues to deliberate, the expert community remains divided on the exact timeline but aligned on the significance. The approval of a spot XRP ETF would not only mark a major milestone for XRP holders but also set the stage for a new era of regulated altcoin investment products. Investors who understand the nuances of regulatory engagement and market readiness will be best positioned to capitalize on the opportunities that lie ahead.
Next steps and potential timeline
With Grayscale and Bitwise officially submitting amended proposals for spot XRP ETFs, the process now enters a critical phase that will determine the timeline and likelihood of approval. The U.S. Securities and Exchange Commission (SEC) follows a structured procedure for ETF applications, and understanding this roadmap is essential for investors and traders looking to position themselves ahead of key decision points.
Once a proposal is formally acknowledged by the SEC, the agency has up to 240 days to make a final determination. This period includes several stages: an initial 45-day review window, potential comment periods, and multiple extensions that can be invoked by the SEC. Given the complexity and novelty of a spot XRP ETF—especially in light of XRP’s unique regulatory history—it is likely that the SEC will utilize the full timeline before reaching a decision.
Currently, the amended filings by Grayscale and Bitwise have been entered into the public docket, triggering the first 45-day review period. During this time, the SEC will solicit public comments and may issue a request for additional information or clarifications from the applicants. These public comment periods are not merely procedural; they offer market participants—including institutional investors, legal experts, and retail advocates—a chance to voice support or raise concerns. A high volume of supportive, well-reasoned comments can influence the SEC’s assessment, adding pressure to approve or at least seriously consider the ETF proposals.
For investors tracking this process, key dates to watch include the expiration of each review window and any announcements of extensions or comment period reopenings. These dates are publicly available on the SEC’s website and can serve as catalysts for short-term price movement in XRP. Traders may also benefit from setting alerts for SEC filings and updates, as these can provide early signals about the regulator’s stance and the likelihood of approval.
In parallel to the SEC’s review, Grayscale and Bitwise are expected to engage in behind-the-scenes dialogue with the agency. This typically involves providing additional data on market integrity, surveillance-sharing agreements, and custody solutions. The firms may also revise their filings further to address specific feedback, a process that could extend the timeline but improve approval odds. In the case of the Bitcoin spot ETFs approved earlier this year, such iterative engagement was instrumental in securing a favorable outcome.
Another important factor in the timeline is the ongoing legal landscape surrounding XRP and Ripple Labs. While the U.S. courts have already ruled that XRP sales on secondary markets do not constitute securities transactions, parts of the SEC’s lawsuit against Ripple remain unresolved. Any new developments in that case—such as settlements, appeals, or final judgments—could materially impact the SEC’s willingness to approve an XRP-based financial product. Investors should monitor court filings and legal commentary closely, as these updates may influence the ETF review process.
If the SEC ultimately approves a spot XRP ETF, the next steps would involve finalizing fund structure, securing exchange listings, and initiating marketing efforts. Based on timelines observed with Bitcoin ETFs, this post-approval phase can move quickly—often within weeks. Asset managers typically coordinate with trading desks, custodians, and liquidity providers in advance to ensure a smooth launch. For investors, this means the window between approval and product availability could be short, making it crucial to prepare early.
In terms of realistic expectations, most analysts believe that a decision on the XRP ETF proposals could arrive by late Q3 or early Q4 of 2024, assuming no major regulatory or legal disruptions. If the SEC opts to delay or deny the applications, revised proposals or legal challenges could extend the process into 2025. However, the current environment—characterized by increased regulatory engagement and growing institutional interest—suggests a more optimistic trajectory.
For traders and investors, the coming months represent a strategic opportunity to accumulate positions, hedge exposure, or explore derivatives that align with potential XRP ETF approval. Those with a long-term view may consider dollar-cost averaging into XRP or related assets, while active traders might capitalize on volatility around SEC announcements and legal milestones.
Ultimately, while the exact timeline remains uncertain, the path forward is becoming clearer. The next stages in the XRP ETF process will not only shape XRP’s market profile but also set important precedents for the integration of altcoins into regulated financial instruments. Staying informed and agile during this period could yield significant upside for those ready to act on new developments.