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NYSE Arca, a subsidiary of the New York Stock Exchange, took a significant step toward converting Grayscale’s XRP Trust into a spot exchange-traded fund (ETF). The move was initiated through the submission of a 19b-4 filing, indicating a formal proposal for the conversion process.
According to the filing, Coinbase (NASDAQ:COIN) Custody Trust Company, LLC is set to act as the custodian for the fund, with BNY Mellon (NYSE:BK) Asset Servicing expected to serve as the administrator and transfer agency. The Grayscale XRP Trust is described as one of the world’s largest XRP investment funds by assets under management, with an approximate value of $16.1 million. The shares of the trust are currently held by American investors seeking exposure to XRP without the direct purchase of the digital asset.
A 19b-4 filing represents the second phase of a two-part procedure required to propose a spot crypto ETF to the U.S. Securities and Exchange Commission (SEC). Once the SEC acknowledges the filing, it will be published in the Federal Register, which will then commence the agency’s review and approval process.
The digital asset market has seen a growing interest from various firms aiming to launch crypto ETFs based on a range of cryptocurrencies, including Dogecoin, Litecoin, and Solana, as well as those tied to cultural phenomena such as President Donald Trump’s memecoin. With a new administration at the helm, the SEC is anticipated to adopt a more accommodating stance toward cryptocurrencies, potentially opening the door for approvals of diverse crypto ETFs.
Earlier in January 2024, the SEC had given the green light to Bitcoin ETFs, followed by approvals for Ethereum ETFs later that same year. The current initiative by NYSE Arca to transform the XRP Trust into an ETF could signal a continuation of this trend, as the industry explores the integration of traditional financial mechanisms with the emerging digital asset space.
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