Ripple CEO Brad Garlinghouse reacts positively to the news of Grayscale launching an XRP Trust.
Yesterday, leading crypto asset manager Grayscale Investments gave accredited investors direct exposure to XRP by launching the first XRP Trust, a closed-end fund that holds only XRP. Interestingly, the asset manager revealed plans to convert the XRP Trust to a spot ETF in the future.
Ripple CEO Reacts in Shock
As expected, the recently launched XRP Trust triggered positive reactions among XRP proponents, including Ripple CEO Brad Garlinghouse.
A tweet from Garlinghouse highlighted his shocking reaction to Grayscale’s introduction of the U.S.’s first XRP Trust.
https://t.co/xbjH6ulqbs pic.twitter.com/Og1CxPmdnw
— Brad Garlinghouse (@bgarlinghouse) September 12, 2024
In a follow-up tweet, the Ripple CEO also expressed surprise at the news but indicated that the development is inevitable. According to Garlinghouse, XRP has already received regulatory clarity in the United States and other countries.
In his view, this clarity is expected to set the stage for further growth of XRP and its entire ecosystem.
“I expect it’s only a matter of time for this space [XRP] to grow,” Garlinghouse remarked.
Notably, this suggests that Garlinghouse sees Grayscale’s XRP Trust as the beginning of widespread adoption and growth for the coin.
XRP Gains Widespread Adoption After Judge Torres’ Ruling
XRP has witnessed broader adoption among retail and institutional investors since a New York federal court provided the coin with much-needed legal clarity in the lawsuit between the SEC and Ripple.
Last year, U.S. District Judge Analisa Torres declared that XRP is not inherently a security, as the SEC alleged. This paved the way for widespread adoption of XRP, starting with U.S.-based exchanges relisting the token. Exchanges like Coinbase, Kraken, and Binance.US relisted XRP immediately after Judge Torres’ declaration.
Additionally, Grayscale has launched an XRP Trust to give accredited investors direct exposure to the token.
Potential XRP ETF
The excitement surrounding the launch stems from Grayscale’s aim to convert the XRP Trust to a spot-based ETF, as it did with its Bitcoin and Ethereum Trusts.
For context, Grayscale’s Bitcoin Trust was officially converted to an ETF in January, followed by its Ethereum Trust in July.
In the meantime, there are concerns that the legal tussle between the SEC and Ripple could hinder the potential launch of an XRP ETF. Notably, launching an ETF for any asset requires the approval of the U.S. Securities and Exchange Commission (SEC).
Given the legal tussle between the SEC and Ripple, many believe it could be difficult for the regulator to approve the launch of an ETF tied to XRP. Nonetheless, the lawsuit recently ended at the district court level last month when Judge Torres issued the final verdict.
If any of the parties appeal the ruling, the lawsuit could extend into 2025 or 2026. Notably, they have less than a month to officially file an appeal notice with the Second Circuit. If no appeal is filed, it would signal the conclusion of the SEC v. Ripple lawsuit, thus bolstering the odds of an XRP ETF.
