Title: Cboe Moves Forward with SEC Filings for Spot XRP ETFs
Overview
Cboe Global Markets has formally lodged four distinct 19b-4 applications with the U.S. Securities and Exchange Commission (SEC) to introduce exchange-traded funds (ETFs) backed by spot XRP. These applications, on behalf of WisdomTree, Bitwise, 21Shares, and Canary, mark a significant step towards gaining regulatory approval for these investment products.
Expert View
In response to the filings, Brad Garlinghouse, Ripple’s CEO, posted a clock emoji, hinting at a possible imminent decision by the SEC. Garlinghouse consistently argues for the feasibility and inevitability of an XRP ETF, instilling confidence that these ETFs will eventually be given the regulatory green light.
Market Landscape
The surge in ETF applications reflects a growing institutional interest in XRP and associated investment offerings. The proposed ETFs seek to mirror the price movements of XRP, currently positioned as the fourth-largest cryptocurrency concerning market capitalization.
Evaluation of Impact
With the 19b-4 submissions following the issuers’ S-1 filings, the proposals are progressing towards regulatory review. The SEC is expected to respond within 240 days of acknowledging the applications. Cboe’s applications emphasize that authorized participants will not have to directly transact XRP when creating or redeeming the ETFs. This unique structure enables investors to profit from XRP’s price shifts without the necessity of owning the cryptocurrency.
Noteworthy is the similarity between Cboe’s filings and the approval processes for spot Bitcoin and Ethereum ETFs. Despite XRP not having a dedicated futures market, the SEC previously approved Bitcoin and Ethereum ETFs even with relatively small futures markets. The filings argue that there are sufficient alternative measures to mitigate fraud and manipulation risks, potentially eliminating the need for a surveillance-sharing agreement, as was the case for Bitcoin and Ethereum ETFs.
As stated in the filing, “There are adequate ‘other means’ to prevent fraud and manipulation, justifying forgoing the surveillance-sharing agreement with a significant size regulated market, similar to Spot Bitcoin ETPs and Spot ETH ETPs, advocating for the approval of this proposal.”
Wrap-Up
Cboe’s steps towards launching spot XRP ETFs through recent SEC filings highlight a changing landscape in cryptocurrency investment products propelled by increasing institutional engagement. As the regulatory journey progresses, the potential approval of these ETFs could mark a substantial stride for XRP in the broader financial framework, improving market accessibility and potentially legitimizing cryptocurrency investments further. As the industry eagerly anticipates the SEC’s verdict, excitement mounts around these unfolding developments, signaling a significant milestone for Ripple and the cryptocurrency realm.
