Grayscale Files S-1 for Spot XRP ETF, Awaiting SEC Greenlight

TL;DR

**Grayscale's XRP ETF filing is a bullish signal for XRP, but don't get too excited until the SEC actually approves it.**

AI Summary

Grayscale XRP Trust (GXRP) filed an S-1 on August 22, 2025, to launch an XRP spot ETF, aiming to provide investors with exposure to XRP's value, less expenses. The Trust, formed on August 5, 2024, will rename to Grayscale XRP Trust ETF upon SEC approval and NYSE Arca listing. Currently, the Trust only supports cash creations and redemptions in Baskets of 10,000 Shares, with a third-party Liquidity Provider facilitating XRP exchange for cash. The SEC has not yet approved the 19b-4 application filed by NYSE Arca on January 30, 2025, which is a prerequisite for the offering. The Trust is an 'emerging growth company' and will operate without the protections of a registered investment company or commodity pool. Its value is directly tied to XRP's highly volatile price, as determined by the CoinDesk Ripple Price Index (XRX).

Why It Matters

This S-1 filing by Grayscale for a spot XRP ETF is a significant development for the cryptocurrency market, potentially opening up a new, regulated avenue for institutional and retail investors to gain exposure to XRP. If approved, it could legitimize XRP as an investable asset class, similar to how Bitcoin and Ethereum ETFs have impacted their respective markets. However, the lack of SEC approval for the 19b-4 application and the current cash-only creation/redemption mechanism, unlike some recently approved spot digital asset ETPs, could limit its efficiency and attractiveness compared to potential competitors. The outcome will heavily influence Grayscale's competitive standing in the digital asset ETF space and could set a precedent for future XRP-related financial products.

Risk Assessment

Risk Level: high — The S-1 explicitly states 'Investing in the Shares involves significant risks' and highlights 'extreme volatility' of XRP. A major risk is the ongoing uncertainty regarding SEC approval of the 19b-4 application, without which 'no offering of Shares hereunder will take place.' Furthermore, a 'determination that XRP or any other digital asset is a 'security' may adversely affect the value of XRP and the value of the Shares and result in potentially extraordinary, nonrecurring expenses to, or termination of, the Trust.'

Analyst Insight

Investors should monitor the SEC's decision on NYSE Arca's 19b-4 application for the Grayscale XRP Trust ETF. Until approval, this is a speculative filing. If approved, consider the inherent volatility of XRP and the Trust's cash-only creation/redemption model, which may lead to wider spreads and less liquidity compared to in-kind models.

Key Numbers

• 10,000 Shares — Basket Size (Minimum block of Shares for creation and redemption)
• August 5, 2024 — Trust Formation Date (Date Grayscale XRP Trust was formed)
• January 30, 2025 — 19b-4 Application Filing Date (Date NYSE Arca filed for listing approval with the SEC)
• May 3, 2025 — Sponsor Transition Date (Date Grayscale Operating, LLC ceases to be a Co-Sponsor)
• 4:00 p.m. New York time — Index Price Calculation Time (Daily time for determining the U.S. dollar value of XRP for Basket Amount)

Key Players & Entities

• Grayscale XRP Trust (company) — Registrant and issuer of Shares
• Grayscale Investments Sponsors, LLC (company) — Co-Sponsor of the Trust
• Grayscale Operating, LLC (company) — Co-Sponsor of the Trust until May 3, 2025
• NYSE Arca, Inc. (company) — Intended listing exchange for the Shares
• U.S. Securities and Exchange Commission (regulator) — Regulatory body whose approval is required for the ETF
• Edward McGee (person) — Chief Financial Officer of Grayscale Investments Sponsors, LLC and Agent For Service
• Coinbase, Inc. (company) — Prime broker of the Trust
• Coinbase Custody Trust Company, LLC (company) — Custodian of the Trust
• The Bank of New York Mellon (company) — Transfer Agent and Administrator of the Trust
• CSC Delaware Trust Company (company) — Trustee of the Trust

FAQ

Risk Factors

• SEC Approval Uncertainty [high — regulatory]: The Trust's launch is contingent on the SEC approving the 19b-4 application filed by NYSE Arca on January 30, 2025. The SEC has not yet granted this approval, creating uncertainty regarding the Trust's ability to list and operate as an XRP spot ETF.
• XRP Price Volatility [high — market]: The Trust's value is directly tied to the price of XRP, which is highly volatile. The CoinDesk Ripple Price Index (XRX) determines XRP's value. Significant price fluctuations in XRP could lead to substantial losses for investors.
• Lack of Registered Investment Company Protections [medium — operational]: The Trust will operate without the protections afforded to registered investment companies or commodity pools. This means investors may have fewer safeguards against certain operational risks and mismanagement.
• Cash Creations and Redemptions Only [medium — financial]: The Trust currently only supports cash creations and redemptions in Baskets of 10,000 Shares. This mechanism relies on a third-party Liquidity Provider to facilitate XRP exchange for cash, introducing counterparty risk.
• Uncertainty of XRP's Legal Status [high — legal]: While not explicitly detailed as a risk factor in the provided text, the ongoing regulatory scrutiny and past legal challenges surrounding XRP (e.g., SEC v. Ripple) represent an inherent legal risk that could impact XRP's marketability and the Trust's viability.

Industry Context

The cryptocurrency market, particularly for digital assets like XRP, is experiencing increasing institutional interest, leading to a wave of spot ETF applications. Competitors are also seeking to launch similar products, intensifying the race for market share. Regulatory clarity remains a significant factor influencing the development and adoption of crypto-based financial products.

Regulatory Implications

The Trust's success is heavily dependent on SEC approval, which is not guaranteed. The classification of XRP and the broader regulatory environment for digital assets pose ongoing risks. Operating as an 'emerging growth company' without registered investment company protections means investors must be aware of potentially fewer safeguards.

What Investors Should Do

1. Monitor SEC Approval Status
2. Assess XRP Volatility Risk
3. Review Trust Structure and Protections

Key Dates

• 2024-08-05: Trust Formation Date — Marks the official establishment of the Grayscale XRP Trust, the legal entity that will underpin the ETF.
• 2025-01-30: 19b-4 Application Filing Date — Indicates the formal request to NYSE Arca for listing approval, a critical step towards SEC approval for the ETF.
• 2025-08-22: S-1 Filing Date — The date the Trust filed its registration statement with the SEC, initiating the public offering process for the XRP spot ETF.
• 2025-05-03: Sponsor Transition Date — Signifies a change in the Trust's sponsorship structure, where Grayscale Operating, LLC ceases to be a Co-Sponsor, potentially impacting operational continuity or strategy.

Glossary

Emerging Growth Company

A company that has total annual gross revenues of less than $1.235 billion during its most recently completed fiscal year. These companies are eligible for certain regulatory accommodations. (Indicates the Trust qualifies for specific exemptions and reduced disclosure requirements under the JOBS Act, potentially impacting investor protections.)

Basket

A block of a specified number of Shares (10,000 in this case) that Authorized Participants must create or redeem. (Defines the unit of trading for creations and redemptions, impacting the scale and efficiency of how the Trust interacts with the market.)

Authorized Participant

A financial institution that has entered into an agreement with the Trust to facilitate the creation and redemption of Baskets of Shares. (Crucial intermediaries for the ETF's creation/redemption mechanism, ensuring the ETF's market price stays close to its Net Asset Value (NAV).)

CoinDesk Ripple Price Index (XRX)

A proprietary index used to determine the U.S. dollar value of XRP for the Trust's daily calculations. (The benchmark for valuing the Trust's underlying asset, directly impacting the NAV and the price of Shares.)

Year-Over-Year Comparison

As this is an S-1 filing for a new ETF, there is no prior year filing to compare against. Key metrics such as revenue, net income, and margins are not applicable at this pre-launch stage. The primary focus is on the regulatory hurdles, the structure of the Trust, and the inherent risks associated with XRP.

Key Financial Figures

• $2.0 billion — trading volume of XRP was approximately $2.0 billion. As of June 30, 2025, the aggregate mar
• $132.1 billion — , the aggregate market value of XRP was $132.1 billion. As of August 21, 2025, XRP was the thi

Filing Documents

• ck0002037427-20250822.htm (S-1) — 2511KB
• ck0002037427-ex3_1.htm (EX-3.1) — 7KB
• ck0002037427-ex10_3.htm (EX-10.3) — 299KB
• ck0002037427-ex10_4.htm (EX-10.4) — 45KB
• ck0002037427-ex10_5.htm (EX-10.5) — 174KB
• ck0002037427-ex10_9.htm (EX-10.9) — 122KB
• ck0002037427-ex10_10.htm (EX-10.10) — 64KB
• ck0002037427-ex23_1.htm (EX-23.1) — 5KB
• ck0002037427_exfilingfees.htm (EX-FILING FEES) — 56KB
• img233947015_0.jpg (GRAPHIC) — 51KB
• img233947015_1.jpg (GRAPHIC) — 981KB
• img233947015_2.jpg (GRAPHIC) — 582KB
• img233947015_3.jpg (GRAPHIC) — 51KB
• 0000950170-25-111044.txt ( ) — 5683KB
• ck0002037427_exfilingfees_htm.xml (XML) — 4KB

Forward-Looking Statements

Forward-Looking Statements ii Prospectus Summary 1 The Offering 7

Use of Proceeds

Use of Proceeds 61 Management’s Discussion and Analysis of Financial Condition and Results of Operations 62

Business

Business 69 Key Personnel of the Sponsor 110 Certain Relationships and Related Party Transactions 112 Description of the Shares 114 Description of Creation and Redemption of Shares 116 Material U.S. Federal Income Tax Consequences 123 ERISA and Related Considerations 129 Plan of Distribution 131 Legal Matters 133 Experts 134 Where You Can Find More Information 135 Glossary of Defined Terms 136 Index to Financial Statements F- 1 Neither the Trust nor the Sponsor has authorized anyone to provide you with any information other than that contained in this prospectus or any free writing prospectus prepared by or on behalf of the Trust. Neither the Trust nor the Sponsor takes any responsibility for, and can provide no assurance as to the reliability of, any information that others may give you. Neither the Trust nor the Sponsor is making an offer to sell any security or soliciting any offer to buy any security in any jurisdiction where the offer or sale is not permitted. You should not assume that the information appearing in this prospectus or any free writing prospectus is accurate as of any date other than the respective dates on the front of such documents. The Trust’s business, assets, financial condition, results of operations and prospects may have changed since those dates. This prospectus does not constitute an offer to sell, or an invitation on behalf of the Trust or the Sponsor, to subscribe to or purchase any securities, and may not be used for or in connection with an offer or solicitation by anyone, in any jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Authorized Participants may be required to deliver a prospectus when making transactions in the Shares. The information contained in the section captioned “Business—Overview of the XRP Industry and Market” is based on informati

View Full Filing

View this S-1 filing on SEC EDGAR