Bitwise Updates S-1 for XRP ETF with Enhanced Security Measures

Bitwise's XRP ETF: Updated Security Measures and Regulatory Challenges

Bitwise Asset Management recently updated its S-1 registration statement for its XRP exchange-traded fund (ETF), filed on October 16. The revised statement includes detailed information on the trust’s structure, asset custody, and share creation and redemption procedures, showcasing Bitwise's commitment to offering a compliant investment product for Ripple’s XRP.

Enhanced Security Measures and Custody Details

The updated filing outlines comprehensive security measures for the proposed XRP-based ETF. Key features include:

• Cold Storage Custody: The XRP Custodian will store the Trust’s assets in secure cold storage, transferring only limited amounts to hot storage for share creation and redemption.

• Asset Separation: XRP assets will be held separately from the custodian’s other holdings, ensuring strong protection for private keys.

• Prime Execution Agent: Bitwise’s Prime Execution agent will handle XRP trades across various platforms, including Bitstamp, Kraken, Coinbase, and LMAX.

Growing Interest and Regulatory Challenges

Bitwise's October 2 filing for an XRP ETF marks a significant move, potentially strategic ahead of November elections. Australia-based Canary Capital also applied for an XRP ETF, reflecting growing interest and a more progressive regulatory environment. However, regulatory approval remains uncertain due to the ongoing Ripple lawsuit and regulatory ambiguity. 

Grayscale Investments is converting its Digital Large Cap Fund into an ETF, with the NYSE filing the necessary documents on October 15. This ETF would include Bitcoin (75%), Ethereum (18%), Solana (4.16%), XRP (1.76%), and Avalanche (0.66%). Approval would provide U.S. investors with regulated ETF exposure to multiple cryptocurrencies. Additionally, Franklin Templeton, Ark Investment, and VanEck have submitted ETF applications for Bitcoin, Ethereum, and Solana.

XRP Price Reaction

Following the news, XRP’s price surged by 2.46% in a day, reaching $0.5522. The cryptocurrency’s market cap stood at $31.28 billion with a 24-hour trading volume of $1.38 billion.

Bitwise’s efforts to launch an XRP ETF highlight the growing interest in cryptocurrency-based investment products, despite regulatory uncertainties. The evolving landscape promises to bring more diversified and regulated options for investors.

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