Introduction to XRP ETFs
The conversation around XRP Exchange-Traded Funds (ETFs) has shifted from Crypto Twitter to trading desks on Wall Street, indicating a significant increase in interest and potential investment in the cryptocurrency. Two key factors are driving this trend: the underestimation of demand for a spot XRP ETF and the evolution of the US market infrastructure for spot crypto funds.
Key Insights
Analysts, including ETF specialist Nate Geraci and Bitwise Chief Investment Officer Matt Hougan, believe that the market is underestimating the demand for a spot XRP ETF. They warn that investors are “grossly” underestimating inflows, which could exceed $1 billion in the first few months of trading. The US Securities and Exchange Commission (SEC) has adopted generic listing standards, streamlining the approval process for certain spot crypto ETFs. While consent is not guaranteed, momentum is building quickly.
What is a Spot XRP ETF?
A spot XRP ETF would hold XRP with a qualified custodian and issue shares that track the fund’s net asset value. This structure enables XRP exposure within brokerage accounts, advisor model portfolios, and retirement platforms, providing familiar reporting and tax treatment. It differs from a futures-based product, which tracks derivatives rather than the asset itself and may differ from spot prices.
US Approvals and Regulations
In September 2025, the SEC adopted generic listing standards, allowing major exchanges to list certain spot crypto exchange-traded products (ETPs) under a uniform set of rules. This change streamlined the listing process but did not remove regulatory oversight or review for non-qualified products. The government shutdown in October slowed staff reviews, but some altcoin spot products have continued to develop through existing routes.
Potential Demand and Growth
Analysts argue that the demand for a spot XRP ETF could exceed expectations, potentially exceeding $1 billion in the first few months. This is based on factors such as distribution, infrastructure, and a clear thesis. XRP’s focus on cross-border payments and settlements offers a narrative that differs from Bitcoin’s “digital gold.” However, the SEC may still question whether the spot XRP markets are sufficiently resistant to manipulation and whether custody and insurance arrangements are appropriate.
Current Availability and Alternatives
Investors outside the US already have access to physically backed ETPs that hold XRP directly, such as 21Shares XRP ETP (AXRP) and CoinShares Physical XRP. US investors can purchase XRP on compliant cryptocurrency exchanges, but this route requires self-custody decisions, exchange counterparty risk, and fragmented trading venues.
XRP vs. Bitcoin
XRP’s investment story focuses on payment infrastructure and fast settlement, whereas Bitcoin’s story focuses on scarcity and macro hedging. If an XRP ETF is launched, it will not replace the role of Bitcoin but rather expand the offering for advisors seeking cash allocation within traditional accounts.
Conclusion
The interest in an XRP ETF is not just speculation; the mechanisms are now known, and credible analysts believe that demand could surprise positively. However, the SEC has yet to approve the product, and the timing may shift due to personnel changes and market quality reviews. As you follow this story, separate the approval prospects from the investment case and review the filings, understand how the ETF would hold and value XRP, and understand the differences between US ETFs and non-US ETPs available today.
This article does not contain any investment advice or recommendations. Every investment and trading activity involves risks, and readers should conduct their own research when making their decision.
