Franklin XRP ETF Files S-1/A, Eyes Cboe BZX Listing

TL;DR

**Franklin's XRP ETF is a bullish signal for XRP, legitimizing the asset for mainstream investors and potentially driving significant capital inflows.**

AI Summary

Franklin XRP Trust (XRPZ) filed an S-1/A on August 22, 2025, for its Franklin XRP ETF, aiming to reflect the performance of XRP's price before expenses. The Trust, formed on February 28, 2025, will issue Shares in Creation Units of 50,000, redeemable by Authorized Participants for XRP and/or cash. Franklin Holdings, LLC, the Sponsor, will assume ordinary fees, including Administrator, Marketing Agent, Custodian, and Cboe BZX Exchange listing fees, up to $X per annum in legal fees. The Sponsor's Fee is an annualized rate of [ ]% of the net asset value, payable quarterly in arrears in U.S. dollars, with the Fund selling XRP to cover this fee and other unassumed expenses. The Fund will not acquire Incidental Rights or assets from forks/airdrops. The CME CF XRP-Dollar Reference Rate - New York Variant was $3.07 on August 18, 2025. The Seed Capital Investor, Franklin Resources Inc., purchased [ ] Creation Units for [ ] XRP, with total proceeds to the Fund of $[ ].

Why It Matters

This S-1/A filing signals Franklin's intent to launch a spot XRP ETF, potentially opening up XRP exposure to a broader range of institutional and retail investors through a regulated exchange-traded product. For investors, it offers a new, potentially more accessible and liquid avenue to invest in XRP without direct cryptocurrency custody. This move intensifies competition in the crypto ETF space, particularly against other firms eyeing similar digital asset products, and could significantly impact XRP's market liquidity and price discovery. Employees of Franklin Holdings and its affiliates are positioned at the forefront of this evolving financial product landscape, while customers gain a new investment vehicle.

Risk Assessment

Risk Level: high — The filing explicitly states, 'Investing in the Shares involves significant risks.' The Fund's value is directly tied to XRP, a volatile and largely unregulated digital asset. Furthermore, the prospectus highlights that the 'Sponsor is not registered with the SEC as an investment adviser' and the 'Fund is not a commodity pool for purposes of the CEA,' indicating a lack of traditional regulatory oversight that investors might expect from a typical ETF.

Analyst Insight

Investors should closely monitor the SEC's approval process for this Franklin XRP ETF, as regulatory clarity for XRP remains a key hurdle. Consider XRPZ as a potential future vehicle for diversified crypto exposure, but only after a thorough understanding of the underlying asset's volatility and the specific risks outlined in the prospectus, particularly regarding regulatory status and custody arrangements.

Financial Highlights

total Assets

$[ ]

cash Position

$[ ]

Key Numbers

• 50,000 — Shares per Creation Unit (Minimum block of shares for institutional creation/redemption)
• $3.07 — CME CF XRP-Dollar Reference Rate (XRP price on August 18, 2025, used for valuation)
• [ ]% — Sponsor's Fee (annualized) (Annualized rate of the net asset value, accrued daily and payable quarterly)
• $[ ] — Total proceeds from Seed Creation Units (Amount received by the Fund from the Seed Capital Investor's purchase)
• [ ] — XRP purchased by Fund (Amount of XRP acquired by the Fund using cash proceeds from Seed Creation Units)
• $[ ] — Per XRP price for Seed Creation Units (Price at which the Fund purchased XRP using cash proceeds from Seed Creation Units)
• 2025-08-22T00:00:00.000Z — Filing Date (Date the S-1/A amendment was filed with the SEC)
• 2025-02-28T00:00:00.000Z — Trust Formation Date (Date the Franklin XRP Trust was formed as a Delaware statutory trust)
• $[ ] — Annual Legal Fees Assumed by Sponsor (Maximum ordinary legal fees and expenses assumed by the Sponsor per annum)

Key Players & Entities

• Franklin XRP Trust (company) — Registrant and issuer of Shares
• Franklin Holdings, LLC (company) — Sponsor of the Trust and Fund
• XRP (other) — Primary asset held by the Fund
• Coinbase Custody Trust Company, LLC (company) — XRP Custodian for the Fund's XRP holdings
• Bank of New York Mellon (company) — Cash Custodian, Administrator, and Transfer Agent for the Fund
• Cboe BZX Exchange, Inc. (company) — Exchange where Shares will be listed and traded
• Franklin Resources Inc. (company) — Seed Capital Investor and affiliate of the Sponsor
• SEC (regulator) — Securities and Exchange Commission, reviewing the S-1/A filing
• Navid J. Tofigh (person) — Contact for Franklin Holdings, LLC
• Stradley Ronon Stevens & Young, LLP (company) — Legal counsel for the filing

FAQ

Risk Factors

• Uncertainty of XRP's Regulatory Status [high — regulatory]: The filing acknowledges the ongoing legal and regulatory uncertainty surrounding XRP, particularly the SEC's classification of XRP as a security. This ambiguity creates a significant risk for the Trust, as adverse rulings or new regulations could impact the liquidity, trading, and overall value of XRP, directly affecting the Fund's ability to track its performance.
• Volatility of XRP Price [high — market]: XRP is a highly volatile digital asset. The Fund's performance is directly tied to the price movements of XRP, which can experience rapid and substantial fluctuations. This volatility poses a risk to investors seeking stable returns and can lead to significant losses.
• Reliance on Third-Party Custodians [high — operational]: The Trust relies on third-party custodians to hold the XRP assets. The failure, insolvency, or security breach of a custodian could result in the loss of the Fund's XRP holdings, leading to a complete loss of investor capital.
• Liquidity Risk of XRP [medium — market]: While XRP is traded on various exchanges, its liquidity can fluctuate. If the Fund needs to buy or sell significant amounts of XRP, it may face challenges in doing so at desired prices, potentially impacting the Net Asset Value (NAV) and the ability to meet redemption requests efficiently.
• Tracking Error [medium — operational]: The Fund aims to reflect the performance of XRP's price before expenses. However, various factors, including fees, expenses, and the timing of trades, can lead to a discrepancy between the Fund's performance and the actual price of XRP, known as tracking error.
• Changes in Digital Asset Regulations [medium — regulatory]: The regulatory landscape for digital assets is evolving globally. New laws or regulations could be introduced that impact the creation, trading, or holding of XRP or digital asset ETFs, potentially affecting the Trust's operations and the value of its holdings.
• Sponsor Fee and Expenses [low — financial]: The Sponsor's Fee of [ ]% and other unassumed expenses will reduce the Fund's Net Asset Value. While the Sponsor assumes certain ordinary fees, any increase in these costs or the need to sell XRP to cover fees could negatively impact investor returns.
• Cybersecurity Risks [high — operational]: The digital nature of XRP and the reliance on digital infrastructure expose the Trust and its service providers to cybersecurity risks, including hacking and theft, which could lead to the loss of assets.

Industry Context

The digital asset ETF market is rapidly expanding, with increasing institutional interest in regulated products that offer exposure to cryptocurrencies like XRP. Competitors are also launching similar products, intensifying the need for clear regulatory frameworks and robust operational structures. The success of such ETFs hinges on investor confidence, regulatory clarity, and the ability to accurately track underlying asset performance.

Regulatory Implications

The Franklin XRP Trust operates in a complex and evolving regulatory environment. The ongoing legal battles surrounding XRP's classification as a security by the SEC present a significant risk. The Trust must navigate these uncertainties and ensure compliance with all applicable securities laws and digital asset regulations to protect investors and maintain its operational viability.

What Investors Should Do

1. Review the specific details of the Sponsor's Fee and other expenses.
2. Assess the current regulatory status and potential future developments concerning XRP.
3. Evaluate the volatility of XRP and its potential impact on investment goals.
4. Understand the role and risks associated with third-party custodians.

Key Dates

• 2025-08-22: S-1/A Filing Date — Indicates the Trust's intention to offer its XRP ETF to the public, initiating the regulatory review process.
• 2025-02-28: Trust Formation Date — Marks the legal establishment of the Franklin XRP Trust as a Delaware statutory trust.

Glossary

Creation Unit

A large block of shares (50,000 in this case) that institutional investors, known as Authorized Participants, must purchase or redeem from the ETF issuer. (This is the mechanism by which new ETF shares are created and existing shares are redeemed, ensuring the ETF price stays close to its Net Asset Value.)

Authorized Participant (AP)

Financial institutions that have entered into an agreement with the ETF issuer to facilitate the creation and redemption process of ETF shares. (AP's are crucial for the ETF's operational efficiency, ensuring liquidity and price stability by creating or redeeming Creation Units.)

Net Asset Value (NAV)

The per-share market value of an ETF's underlying assets, calculated by subtracting liabilities from total assets and dividing by the number of outstanding shares. (The NAV is the theoretical value of the ETF's holdings, and the ETF's market price typically trades very close to its NAV.)

Sponsor

The entity responsible for the organization and management of the ETF, in this case, Franklin Holdings, LLC. (The Sponsor manages the ETF's operations, incurs certain fees, and is responsible for its overall strategy and compliance.)

CME CF XRP-Dollar Reference Rate

A benchmark rate for the price of XRP against the US Dollar, calculated by CME Group and CF Benchmarks. (This rate is used for valuing the Trust's XRP holdings and for calculating the Net Asset Value.)

Seed Capital Investor

The initial investor providing capital to the ETF before its public launch, often purchasing shares in Creation Units. (The Seed Capital Investor's purchase provides initial funding and liquidity for the ETF, demonstrating early commitment.)

Incidental Rights

Rights or assets that may arise from holding a digital asset, such as airdrops or hard forks, which the Trust will not acquire. (This clarifies that the Trust will not benefit from potential airdrops or other distributions related to XRP, focusing solely on tracking XRP's price.)

Year-Over-Year Comparison

This is the initial S-1/A filing for the Franklin XRP Trust, so there is no prior filing to compare key metrics against. The filing establishes the Trust's structure, objectives, and operational framework, including the Sponsor's Fee and the reliance on the CME CF XRP-Dollar Reference Rate for valuation.

Key Financial Figures

• $3.07 — Benchmarks Ltd., on August 18, 2025 was $3.07. Except when aggregated in Creation U

Filing Documents

• fxrps1a082025.htm (S-1/A) — 1069KB
• image00001.jpg (GRAPHIC) — 485KB
• 0001137439-25-001026.txt ( ) — 1738KB

USE OF PROCEEDS

USE OF PROCEEDS 72 OVERVIEW OF THE XRP INDUSTRY 72 BUSINESS OF THE FUND 82 DESCRIPTION OF THE SHARES AND THE TRUST 94 CREATIONS AND REDEMPTIONS 97 THE TRUSTEE 115 115 FISCAL YEAR 116 THE SECURITIES DEPOSITORY; BOOK-ENTRY-ONLY SYSTEM; GLOBAL SECURITY 116 THE SPONSOR 117 THE TRUSTEE 119 THE ADMINISTRATOR 120 THE CUSTODIANS 121 THE PRIME BROKER AND THE TRADE CREDIT LENDER 124 TRADING COUNTERPARTIES 130 THE INDEX ADMINISTRATOR AND SECONDARY INDEX PROVIDER 131 THE MARKETING AGENT 131 U.S. FEDERAL INCOME TAX CONSEQUENCES 132 ERISA AND RELATED CONSIDERATIONS 137 SEED CAPITAL INVESTOR 138 PLAN OF DISTRIBUTION 139 CONFLICTS OF INTEREST 140 GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION 141 LEGAL MATTERS 142 EXPERTS 142 WHERE YOU CAN FIND MORE INFORMATION 142 GLOSSARY 143 iv This prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this prospectus. Neither the Trust, on behalf of the Fund, nor the Sponsor has authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. This prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. Until [ ], 2025 (25 days after the date of this prospectus), all dealers effecting transactions in the Shares, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. The Sponsor first intends to use this prospec

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View this S-1/A filing on SEC EDGAR