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The U.S. Securities and Exchange Commission (SEC) has officially approved ProShares Trust to launch three XRP futures-based exchange-traded funds (ETFs), signaling growing institutional interest in Ripple’s native token. According to the SEC filing, the new ETFs are set to debut on April 30, offering investors a fresh way to gain exposure to XRP price movements without directly owning the asset.
Details of the New ProShares XRP ETFs
ProShares’ new suite includes three offerings: the Ultra XRP ETF, which provides 2x leveraged exposure to XRP futures; the Short XRP ETF, delivering inverse (-1x) exposure; and the Ultra Short XRP ETF, offering inverse (-2x leveraged exposure. These ETFs will track the XRP Index, not hold XRP directly, allowing investors to benefit from XRP’s price volatility through futures contracts.
ProShares originally filed the proposals on January 17, marking a significant step toward expanding futures-based crypto investment products in the U.S. The approval follows the successful launch of Teucrium’s XRP futures ETF on April 8, which saw strong market demand.
Ripple’s Legal Progress and Market Impact
The timing of the ETF approval coincides with Ripple’s improved relationship with the SEC. Ripple, which had been embroiled in a legal battle with the SEC since 2020, recently announced a joint motion with the regulator to pause further court proceedings. A partial legal victory in 2023 ruled that XRP is not a security when traded on secondary markets, although Ripple paid a $125 million penalty for past institutional sales.
Also Read: Patrick Bet-David Predicts XRP Could Replace SWIFT and Soar to $100: Here’s How
The SEC’s friendlier approach under new leadership and the ongoing settlement discussions have fueled positive sentiment around XRP. Following the ProShares ETF news, XRP’s price surged 3.5%, outperforming major cryptocurrencies like Bitcoin, which barely moved during the same period. XRP’s market capitalization now stands at over $312 billion.
Outlook for Spot XRP ETFs
While the futures-based ETFs mark a significant milestone, the crypto industry continues to await the approval of spot XRP ETFs. Firms such as Grayscale, Bitwise, and WisdomTree have applications pending with the SEC. Analysts remain optimistic that with the CME Group’s plans to introduce XRP futures, a spot XRP ETF could be on the horizon later this year.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
