🌎 SEC To Rule on Grayscale XRP ETF Application

SEC Expected to Rule on Grayscale’s XRP ETF Application

The U.S. Securities and Exchange Commission (SEC) is anticipated to respond to Grayscale Investments’ application to convert its XRP Trust into a spot exchange-traded fund (ETF) as early as February 13. This timeline is based on the SEC’s standard 15-day window to respond to a 19b-4 filing, which Grayscale submitted on January 30.

Grayscale’s Initiative and Its Implications

Grayscale’s proposal aims to transform its existing XRP Trust, which currently manages approximately $16.1 million in assets, into an ETF listed on the New York Stock Exchange. If approved, this move would allow investors to trade shares of the fund, providing exposure to XRP without the complexities of direct cryptocurrency ownership.

The SEC’s forthcoming decision could offer significant insight into the agency’s current stance on XRP, particularly given its historical legal disputes with Ripple, the company behind XRP. A federal court ruling previously determined that XRP is not a security when traded on secondary markets, a decision that may influence the SEC’s approach to related financial products.

High Likelihood of Approval and Market Impact

Polymarket bettors estimate an 81% probability of the SEC approving a spot XRP ETF this year. The outcome of Ripple’s ongoing legal battle with the SEC remains a pivotal factor in this assessment.

“The possibility of an SEC approval for a spot XRP ETF could have a significant impact on the cryptocurrency’s price and market sentiment.”

Currently, XRP‘s price has dropped nearly 30% from its January peak, entering a bear market as daily trading volume and futures open interest decline.