TL;DR

Teucrium Paved the Way

In the past year or so, multiple companies have sought the launch of an exchange-traded fund (ETF) in the USA tracking the performance of Ripple’s native token. Earlier this month, Vermont-based asset manager Teucrium made headlines by becoming the first to introduce such a financial vehicle in the world’s biggest economy.

Its product, called Teucrium 2x Long Daily XRP ETF (XXRP), was listed on NYSE Arca and offers investors leveraged exposure to the daily price movements of the cryptocurrency. It had a solid start, generating approximately $5 million in trading volume on its debut day.

Just a few days ago, the US Securities and Exchange Commission (SEC) approved the launch of three additional XRP ETFs, all issued by ProShares.

The Ultra XRP ETF, Short XRP ETF, and Ultra Short XRP ETF were expected to go live on April 30, but James Seyffart (a research analyst at Bloomberg Intelligence) later debunked that information. He said the actual launch will likely happen in “the short or possibly medium term.”

According to updated filings with the securities regulator, the products in question will become available on May 14. 

The investment vehicles from Teucrium and ProShares are futures-based, offering investors exposure to XRP’s price through derivatives. Unlike spot ETFs, they don’t hold real tokens, raising the question of when a spot one will finally see the light of day in America.

Decision Delayed

The big names lining up for approval to launch a spot XRP ETF include Grayscale, Franklin Templeton, 21Shares, WisdomTree, Bitwise, and more.

Such a product (if it receives the green light from the SEC) will make it easier for investors to gain exposure to Ripple’s native token. After all, purchasing a spot ETF is as simple as buying stocks, and everything is handled through authorized brokerage accounts. In the aftermath, investors own shares of the fund, which in turn purchases and stores the actual cryptocurrency to back their holdings.

The SEC recently underwent significant leadership changes, with Paul Atkins becoming the new Chairman. He has shown a pro-crypto stance in the past, which gave the Ripple community high hopes that the approval of a spot XRP ETF might be on the way.

However, the Commission poured cold water on those expectations (at least for the moment). It delayed its decision on the product proposed by Franklin Templeton and set a new deadline of June 17. For her part, Fox Business’s Eleanor Terrett noted that the date is “intermediate,” suggesting that another delay will not come as a surprise. 

Despite the SEC’s recent decision, the approval odds remain high. Eric Balchunas (Senior ETF analyst at Bloomberg) estimated an 85% probability of such a product going live sometime in 2025. According to Polymarket, the chance is around 80%.