In a bold move, Grayscale has introduced a new trust that will allow users in the USA to invest in XRP without directly owning it. The trust could highly benefit from zero-competition markets where ETF buyers have been trying to diversify investments.
In the US, it is compulsory to form a trust before you issue any ETFs because the shares of a trust are sold as ETFs in the secondary markets.
Grayscale XRP Trust
Grayscale has introduced an XRP Trust, giving users a simpler way to invest in XRP without the usual complexities of cryptocurrency transactions. This trust is designed to cater to a wide range of investors, from beginners to experts.
ETF Sooner Than Expected
The XRP Trust is seen as a first step toward launching an XRP Exchange-Traded Fund (ETF).
In the U.S., ETFs typically begin as trusts, with shares sold to the public later. The creation of this trust signals that an XRP ETF could be closer than anticipated.
Further, the move by Grayscale in this space would definitely attract other investors like BlackRock, , VanEck, Ark Invest and others.
Subscription Open
Investors can now subscribe to the XRP Trust through Grayscale’s website, offering a straightforward method to invest in XRP.
Is It Sustainable?
Grayscale would highly gain from a competitor-free market. No other wealth manager or ETF issuer is active in this space. Further, the model of operation has been immensely successful in the previous two cases of Bitcoin and Ethereum ETFs where Grayscale was the largest player for over a year before the ETFs came.
However, there has been a small issue with this business model. Upon the launch of the ETFs, Grayscale Trusts bleed left right, and center because of high fees. For example in the case of Ethereum ETFs, the Grayscale Ethereum Trust has already lost $2.7 billion worth of ETH from its reserves because its fee was up to 6x of what other ETFs charge.
XRP’s Real-World Utility
XRP stands as the third most valued cryptocurrency, behind Bitcoin and Ethereum. It plays a vital role in real-world applications such as cross-border payments and land tokenization, making it more valuable than many other digital currencies.
Future Outlook
No official applications for an XRP ETF have been submitted yet. However, industry experts predict that approval might come by late 2025 or early 2026.