Regulatory authorities overcome challenges through innovative XRP ETF solutions

Recent advancements in the cryptocurrency ETF sector have generated considerable excitement among both investors and industry observers, particularly regarding

. Shares and Osprey Funds are getting ready to introduce their XRP ETF, which aims to be among the earliest to launch in the U.S. using the 1940 Investment Company Act framework. The ETF, which is set to trade under the XRPR ticker, is planned for a September 18 debut and will dedicate 80% of its portfolio to XRP. Unlike conventional spot crypto ETFs, this product will allocate 20% to cash and equivalents and 40% to other XRP ETFs, including those that are not spot-based.

Regulatory considerations continue to play a crucial role in the fate of XRP ETFs. The U.S. Securities and Exchange Commission (SEC) has traditionally taken a conservative approach, particularly toward ETFs tied to single cryptocurrencies. According to James Seyffart, an ETF analyst at Bloomberg, the absence of a regulated futures market for XRP complicates its ETF approval process. While

and ETFs benefited from their association with regulated futures, the outlook for XRP and other alternative coins remains less certain.

The REX-Osprey XRP ETF is structured to comply with the requirements of the 1940 Act, a path that has generally resulted in quicker and more straightforward approvals than the 1933 Act. This setup allows the fund to operate as an open-end investment company, facilitating faster access to the market. Seyffart points out that this structure could see the ETF go live within 75 days of its filing, as long as the SEC does not intervene. However, the ETF’s management fee is set at 0.75%, which is higher than other spot ETFs like the iShares Bitcoin Trust, which charges 0.25%.

The XRP ETF forms part of a broader surge in cryptocurrency-related ETFs gaining momentum in the U.S. By August 2025, a total of 92 crypto ETPs are in development, with the REX-Osprey offerings among the first to adopt the 1940 Act format. This strategy is intended to address the regulatory ambiguity around spot ETFs and aims to offer investors a more reliable and open structure. The SEC has also postponed decisions on other competing proposals, such as those from Franklin Templeton,

, and Fidelity, underlining the persistent challenges in gaining regulatory approval.

The launch of the XRP ETF is expected to have a notable effect on the market by giving both individual and institutional investors regulated and liquid access to XRP. This could result in increased investor interest and potentially affect the asset’s price movements. The ETF’s design, which blends direct crypto holdings, cash, and exposure to other ETFs, aims to diversify risk and provide balanced exposure. Nonetheless, issues such as potential market manipulation and compliance risks continue to be important concerns for the crypto industry.

To sum up, the REX-Osprey XRP ETF marks a significant milestone for cryptocurrency ETFs, introducing a regulated way for investors to gain exposure to XRP. While regulatory hurdles remain complex, adopting the 1940 Act framework offers a feasible route for faster launches and improved transparency. As the SEC reviews various ETF proposals, the approval of this ETF may signal growing acceptance of digital asset investment vehicles in the U.S. market.