Bitwise has taken a significant step by filing for the first-ever Spot XRP ETF with the U.S. Securities and Exchange Commission (SEC). The trust, registered in Delaware, aims to provide investors with direct exposure to XRP’s value, which will reflect the coin’s price minus operational costs. This marks a major move for the crypto space, but it raises an important question: is an XRP futures market necessary?
Bitwise Files for First Spot XRP ETF
As one of the largest crypto asset managers, Bitwise has been behind several crypto ETFs and is now leading the charge for an XRP Spot ETF. In its filing, Bitwise highlighted that XRP holdings for the trust will be secured by Coinbase Custody Trust Company.
While this custodial service isn’t insured by the FDIC, private insurance is in place to offer protection, as with other Bitwise ETFs.
The application for the Spot XRP ETF was filed on October 2, marking a follow-up to the registration of the XRP ETF Trust in Delaware. The move has sparked excitement, but also some debate, as the SEC has previously required a futures market for Bitcoin and Ethereum spot ETF approvals.
Will an XRP Futures Market Be Needed?
In a recent interview on the Thinking Crypto podcast, SEC Commissioner Hester Peirce addressed the need for futures markets in ETF approvals. When asked whether an XRP futures market is necessary, she stated that a spot ETF doesn’t always require one.
It depends on the specific product, but having a futures market has helped in understanding the underlying asset, as seen with Bitcoin and Ethereum.
Peirce also noted that while Bitcoin and Ethereum benefited from futures markets, this doesn’t mean every cryptocurrency needs one. Each case should be evaluated on its own, meaning XRP could potentially proceed without a futures market in place.
As Bitwise leads this effort, the future of XRP’s market dynamics will be closely watched, especially with the possibility of competing with larger assets like Bitcoin and Ethereum.
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