SEC Makes Landmark Statement On Grayscale XRP ETF

The U.S. Securities and Exchange Commission (SEC) has acknowledged Grayscale Investments’ proposal to list and trade shares of the Grayscale XRP Trust as an exchange-traded fund (ETF), and the crypto world is anticipating its next steps.

Fox Business journalist Eleanor Terrett shared the news of the regulator’s acknowledgment of Grayscale’s filing on X. This acknowledgment and potential approval could mark a turning point in the regulatory treatment of XRP, opening the door for greater institutional involvement in the cryptocurrency market.

Regulatory Shift Under New Leadership

For years, the SEC took a cautious stance on cryptocurrency-based financial products. Under former Chair Gary Gensler, the agency maintained that many digital assets, including XRP, should be classified as securities. This position led to strict regulatory scrutiny and prolonged legal disputes within the crypto industry.

Before stepping down, Gensler’s SEC had maintained that it would not approve new crypto ETFs until the new administration took over in 2025. However, with Donald Trump now in office and his administration’s more favorable stance toward digital assets, the SEC appears to be reconsidering its approach.

Market Impact of an XRP ETF Approval

An approved XRP ETF would provide institutional investors with a regulated vehicle to gain exposure to the digital asset. Although Ethereum had a muted response after its ETFs were approved, Bitcoin ETFs contributed significantly to its rise to a new all-time high in March 2024.

XRP ETF approval could lead to increased liquidity, higher trading volumes, and greater mainstream adoption. Institutional participation has been a key factor in legitimizing cryptocurrencies as an asset class, and ETF approval could encourage further expansion of crypto-related financial products.

With multiple financial firms having applied for XRP ETFs over the past few months, approval of Grayscale’s application could set a precedent for approvals of further listings.

What Does This Mean for the Ripple Lawsuit?

XRP has been in the legal battle between Ripple and the SEC for years. While the uncertainty has impacted the token’s adoption in the U.S., if the SEC approves the ETF, it could be seen as an implicit acknowledgment that XRP can be treated similarly to other crypto assets like Bitcoin and Ethereum, which now have approved spot ETFs.

Terrett explained in another post that while the SEC’s acknowledgment is not an approval, it shows a shift in the regulator’s stance toward digital assets. She noted that the SEC is now more open-minded, and sees this as a good first step.

Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.

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