Exchange-Traded Funds (ETFs) based on XRP have emerged as a hot topic in the cryptocurrency market, especially in recent months, due to regulatory developments, growing institutional interest, and the evolution of the global crypto landscape. Below, I present an informed and updated opinion on XRP ETFs, considering recent events, market context, and potential impacts.
Context and recent advances
Initial launches and leveraged products in the U.S.: In April 2025, Teucrium Investment Advisors launched the first XRP ETF in the United States, the Teucrium 2x Long Daily XRP ETF (XXRP), which offers 2x leveraged exposure to the daily price of XRP. This debut, which began trading on NYSE Arca, marked a milestone as the first XRP ETF in the U.S. market, though it is noteworthy that it is a leveraged product rather than a spot ETF (non-leveraged). This move is unusual, as cryptocurrency ETFs typically begin with spot products, as was the case with Bitcoin and Ethereum. Teucrium's decision reflects confidence in XRP's potential but also underscores the regulatory challenges that still hinder the approval of spot ETFs in the U.S.
Proliferation of spot ETF applications in the U.S.: As of March 2025, at least nine asset managers, including Bitwise, Grayscale, Franklin Templeton, 21Shares, WisdomTree, Canary Capital, ProShares, CoinShares, and Volatility Shares, have submitted applications to the Securities and Exchange Commission (SEC) to launch spot XRP ETFs. These applications are under review, with deadlines for final decisions extending to October 2025 (for example, Grayscale on October 18, Bitwise on October 20). The SEC has postponed decisions several times, reflecting its caution, but the growing number of applications indicates strong institutional interest.
International developments: Brazil leads the way: Brazil has become a pioneer by launching the world's first spot ETF for XRP, the XRPH11, managed by Hashdex and trading on the B3 stock exchange. This fund, approved by Brazil's Comissão de Valores Mobiliários (CVM), invests at least 95% of its assets in XRP or related derivatives and is aimed at institutional and sophisticated investors. This milestone reinforces Brazil's position as a cryptocurrency-friendly hub and could pressure regulators in other countries, including the U.S., to accelerate their approval processes.
Resolution of the Ripple-SEC case: A critical factor for XRP ETFs is the evolution of the legal case between Ripple Labs and the SEC. In April 2025, the SEC and Ripple agreed to reduce a $125 million fine to $50 million and withdraw mutual appeals, suggesting an imminent resolution. Additionally, the SEC is expected to request the judge to lift a court order prohibiting institutional sales of XRP, which could pave the way for greater regulatory clarity. This clarity is essential for the approval of spot ETFs, as uncertainty over whether XRP is a security or a currency has been a significant obstacle.
Institutional interest and liquidity: According to Kaiko, XRP is well-positioned for the approval of spot ETFs due to its high liquidity on U.S. exchanges, which recently reached levels not seen since before the SEC lawsuit in 2020. The launch of Teucrium's leveraged ETF and the approval of XRP futures by CME Group (scheduled for May 2025) reinforce this narrative. Additionally, investment products related to XRP globally have attracted significant flows, with $37.7 million in inflows in a single week in mid-April, according to CoinShares.
Opinion: Opportunities and challenges
Opportunities:
Institutional momentum: The approval of a spot XRP ETF in the U.S. could trigger a wave of institutional investment, similar to what was observed with Bitcoin and Ethereum ETFs. JPMorgan analysts estimate that XRP ETFs could attract up to $8 billion in net flows if approved in major markets. This would not only increase demand but could also stabilize the price of XRP by improving liquidity and price discovery.
Impact on price: Speculation about ETFs has already driven the price of XRP, which is trading around $2.20-$2.30 at the end of April 2025, with a 6.1% increase in 24 hours following ETF-related news. Analysts are optimistic, with projections ranging from $5-$7 in a moderate scenario to $15-$25 in a case of mass adoption, especially if giants like BlackRock enter the market. The reduction in available supply due to ETF accumulation could amplify this effect.
Global adoption: The success of the Brazil ETF and the growing utility of XRP in cross-border payments (driven by Ripple partnerships and the possible unveiling of agreements after the expiration of 1,700 confidentiality agreements) could solidify XRP as a key asset in global finance. This would strengthen the case for ETFs in other markets.
Favorable regulatory change: The departure of Gary Gensler as SEC chairman and the arrival of a more cryptocurrency-friendly administration under President Donald Trump have increased the odds of ETF approvals. Polymarket estimates a 72%-79% probability for the approval of an XRP ETF in 2025, reflecting market optimism.
Challenges:
Volatility and market risks: XRP is known for its high volatility, with price movements driven by regulatory news and market sentiment. For example, in 2023, XRP's price surged 70% following a favorable court ruling but then experienced corrections. ETFs, especially leveraged ones like XXRP, amplify these risks, which could deter more conservative investors.
Persistent regulatory uncertainty: Although the Ripple-SEC case is close to resolution, any delay in the withdrawal of appeals or an adverse decision could delay the approval of spot ETFs. The classification of XRP as a security or currency remains a point of controversy that could complicate the process.
Competition with other cryptocurrencies: Although XRP leads the race for ETFs among altcoins (ahead of Solana and Dogecoin, according to Kaiko), market attention remains focused on Bitcoin and Ethereum, which dominate ETF flows. This could limit initial interest in XRP ETFs until its investment narrative solidifies.
Operational risks: XRP ETFs, especially those that do not directly hold the asset (such as XXRP, which uses swaps and futures), face tracking risks and operational costs. Management fees (1.85% for XXRP, 2.50% for Grayscale XRP Trust) could erode long-term returns, especially in a volatile market.
Future outlook
The trajectory of XRP ETFs looks promising, driven by growing institutional interest, regulatory advancements, and market leadership like Brazil. The approval of a spot ETF in the U.S., likely in the second half of 2025 according to Ripple CEO Brad Garlinghouse, could be a significant catalyst for XRP's price and adoption. However, investors should be cautious due to inherent volatility, regulatory risks, and costs associated with these products.
Recommendation: Investors interested in XRP ETFs should closely monitor SEC decisions, especially the deadlines in October 2025, and developments in the Ripple-SEC case. For those with a high-risk tolerance, the leveraged ETF XXRP offers an option to capitalize on short-term movements, but once approved, spot ETFs could be more suitable for long-term strategies. In the meantime, exploring options like the XRPH11 ETF in Brazil or regulated cryptocurrency investment platforms (such as Crypto IRAs) could be an alternative to gain exposure to XRP.
In summary, XRP ETFs represent an exciting yet complex opportunity. Their success will depend on regulatory clarity, institutional adoption, and XRP's ability to maintain its relevance in an increasingly competitive crypto market. The bullish narrative is strong, but it is not without risks that require careful assessment.