A surprising event just occurred in the US financial market: the first ETF based on the XRP token will not be a spot ETF, but rather a 2x leveraged product. This move marks a bold step in the wave of ETF funds related to crypto and could change investors' perceptions of XRP in the near future.
Teucrium 'plays big': Launching the XRP leveraged ETF on April 8.
According to information from Teucrium Investment Advisors – an asset management company based in the USA – the ETF coded #XXRP will officially be listed on the NYSE Arca on April 8. This is the first 2x leveraged ETF related to XRP, meaning it is designed to provide double the daily price volatility performance of XRP.
This product is only suitable for short-term investors with a high risk appetite, as it comes with a rather 'steep' management fee – 1.85% per year.
Leveraged ETFs appear before spot ETFs: A strange phenomenon in the market.
Typically, leveraged ETFs only appear after spot ETFs have been approved and traded steadily. However, in the case of XRP, everything is going in reverse.
Mr. Eric Balchunas, Bloomberg's senior ETF analyst, commented on platform X:
"Very strange (and perhaps for the first time) for an asset to have a leveraged ETF before a spot ETF. The XRP spot ETF has not yet been approved, although the likelihood of approval is quite high."
This shows that Teucrium is one step ahead of the market, while also expressing the expectation that the SEC will soon greenlight other #ETFXRP – especially as the SEC's attitude towards crypto is gradually 'loosening up'.
SEC: From strict to more friendly towards crypto?
Teucrium's bold launch of a leveraged ETF based on XRP coincides with a series of recent changes from the SEC:
In March, the SEC officially ended the years-long lawsuit against Ripple, the company behind XRP. Ripple only had to pay a fine of $50 million – a surprisingly light penalty for many following the case.
In January, the SEC approved a series of spot Bitcoin ETFs, paving the way for other crypto products like $SOL , $LTC , $DOGE and XRP to step into the traditional financial market.
After President Donald Trump's inauguration in January, investors noted a wave of financial companies filing applications for crypto ETFs, taking advantage of the new policy environment that is friendlier to digital assets.
Spot XRP ETF is awaiting approval: Many big names are getting involved.
Although no spot ETF for XRP has been approved yet, many major financial institutions have filed applications with the SEC, including:
WisdomTree
Bitwise
21Shares
Canary Capital
Franklin Templeton
The SEC has received the application and is in the process of evaluating it. If approved, the market will see more XRP investment products launched – not just leveraged but also traditional spot ETFs.
How is XRP doing now?
As of now, XRP is trading around $1.87, down 3% in the past 24 hours. However, this price movement does not fully reflect the potential volatility when the leveraged ETF officially trades.
With a high-risk and easily volatile nature, leveraged ETFs often attract speculators or professional traders. But at the same time, it can also increase liquidity and attention to the underlying asset – in this case, XRP.
Conclusion: Is this a turning point or a 'risky bet'?
The launch of the XRP leveraged ETF before the spot ETF is a rare precedent, demonstrating both risk-taking and a strategic approach from Teucrium. If the SEC continues to approve spot ETFs in the near future, Teucrium will have a pioneering advantage in the XRP ETF market.
However, this also poses significant risks for retail investors, especially those who do not fully understand how leveraged ETFs work. With high fees and rapid volatility, this product is not suitable for long-term investment, but mainly for quick day trading.
As the crypto market is gradually approaching Wall Street, investors should closely observe the moves from the SEC, as well as the developments of XRP in the coming weeks. Who knows, the XXRP ETF could be the 'first shot' for a wave of altcoin ETFs on the financial streets of New York.