The race to bring cryptocurrency exchange-traded funds to market has entered a new phase. On February 7, 2025, Chicago’s Cboe BZX Exchange submitted four separate 19b-4 applications to the US Securities and Exchange Commission for spot XRP ETFs from WisdomTree, Bitwise, 21Shares, and Canary Capital, marking a significant expansion of the crypto ETF landscape beyond Bitcoin and Ethereum.
TL;DR
- Cboe BZX filed four 19b-4 applications for spot XRP ETFs from WisdomTree, Bitwise, 21Shares, and Canary Capital
- NYSE Arca separately filed to convert Grayscale’s XRP Trust into an ETF with Coinbase Custody as custodian
- XRP surged 7% to a daily high of $2.53 following the news despite being down 24% for the week
- The filings reference the July 2023 court ruling that XRP is not a security in secondary market transactions
- DeFi TVL holds steady at $107 billion as the broader crypto market cap reaches $3.30 trillion
Four Applicants, One Goal
The four applications submitted by Cboe represent a coordinated push by major asset managers to bring XRP-based investment products to mainstream markets. Each firm brings a different approach to the table. WisdomTree has implemented safeguards that include sourcing XRP from secondary markets rather than directly from Ripple Labs, a strategy designed to address potential SEC concerns about the token’s regulatory status.
Additional protective measures outlined in the filings include enhanced market surveillance, third-party custody solutions, cold storage for XRP holdings, and mechanisms to suspend trading if necessary. These provisions reflect lessons learned from the protracted Bitcoin and Ethereum ETF approval processes, where the SEC repeatedly cited concerns about market manipulation and investor protection.
The filings come just a week after NYSE Arca submitted its own application to convert Grayscale’s XRP Trust into a spot ETF. That filing designated Coinbase Custody Trust as the custodian and BNY Mellon Asset Servicing as the transfer agent, signaling serious institutional infrastructure backing the product.
The XRP Regulatory Landscape
Unlike Bitcoin and Ethereum, XRP lacks an established futures market on the Chicago Mercantile Exchange. This distinction matters because the CME futures market was a key component in the SEC’s decision-making process for approving Bitcoin and Ethereum spot ETFs. The absence of this market infrastructure means XRP ETF applicants face a steeper regulatory climb.
However, the applications heavily reference the July 2023 court ruling by Judge Analisa Torres, which found that XRP is not a security when traded on secondary markets. That ruling was a watershed moment for the token, even as the SEC continues to appeal aspects of the case. In October 2024, the SEC appealed Judge Torres’s ruling that imposed a $125 million civil penalty on Ripple for 1,278 institutional sale transactions that violated securities law.
Ripple’s chief legal officer, Stuart Alderoty, dismissed the SEC’s latest appeal as “expected” but also “just noise.” The market, at least for the moment, appears to agree. XRP jumped 7% to hit $2.53 on February 7 following the ETF filing news, though the token remains down approximately 24% for the week after approaching its all-time high of nearly $3.40 in January.
Implications for DeFi and Broader Crypto Markets
The expansion of the ETF landscape beyond Bitcoin and Ethereum carries significant implications for decentralized finance and the broader cryptocurrency ecosystem. Each new approved ETF creates additional on-ramps for institutional capital to flow into the crypto market, and the infrastructure built to support these products — custody solutions, market surveillance, and compliance frameworks — benefits the entire ecosystem.
For DeFi protocols specifically, the growing acceptance of cryptocurrency through regulated investment vehicles validates the underlying technology. As more tokens gain ETF status, the DeFi protocols that facilitate trading, lending, and yield generation for those assets stand to benefit from increased liquidity and market maturity.
The SEC also acknowledged filings for Grayscale’s Litecoin and Solana trusts on the same day, suggesting that the regulator is preparing to evaluate a broader range of crypto ETF applications. This multi-asset approach to ETF approvals could accelerate the integration of DeFi assets into traditional finance portfolios.
Market Reaction and ETF Flow Dynamics
The broader market context adds complexity to the XRP ETF narrative. The cryptocurrency market is still recovering from the February 2 liquidation event that wiped out over $2.2 billion in positions. Bitcoin trades around $97,500, and Ethereum holds near $2,700, with the global crypto market cap at $3.30 trillion.
Ethereum ETFs have demonstrated particular strength, recording $307.8 million in inflows on February 4 alone, led by BlackRock’s ETHA at $276.2 million. The consistent inflows into ETH-based funds suggest that institutional appetite for crypto exposure extends beyond Bitcoin, which bodes well for future XRP ETF demand if and when products are approved.
The SEC now has 45 days to review the XRP ETF applications once they are published in the Federal Register, with the possibility of extending the review period by up to 90 days. This timeline suggests that the earliest possible approval decisions would come in mid-2025, adding another layer of anticipation to an already eventful year for cryptocurrency regulation.
Why This Matters
The filing of four simultaneous XRP ETF applications through Cboe represents more than just a bet on a single cryptocurrency. It signals that the asset management industry sees a viable path to offering investment products for a wide range of digital assets beyond Bitcoin and Ethereum. For the DeFi sector, this expansion validates the utility and market maturity of alternative blockchain ecosystems. The regulatory clarity that comes with ETF approval processes — even unsuccessful ones — gradually builds the framework that DeFi protocols need to operate with confidence. As the line between traditional finance and decentralized finance continues to blur, each new ETF filing brings the two worlds closer together.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk, and readers should conduct their own research before making investment decisions.
four filings on the same day from Cboe. WisdomTree, Bitwise, 21Shares, and Canary all want a piece of the XRP ETF pie
XRP surging 7% to $2.53 even after being down 24% for the week. ETF hype overpowers every other narrative for this token
WisdomTree sourcing XRP from secondary markets instead of Ripple directly is smart. preemptively addressing the SEC concerns
the July 2023 Torres ruling basically made these filings possible. XRP not a security in secondary transactions cleared the path
^ that ruling was the single most important crypto legal decision since the Howey test itself. four ETF filings prove it
Grayscale converting their XRP trust into an ETF with Coinbase Custody is the same playbook that worked for GBTC. smart
DeFi TVL at $107B while XRP ETFs get filed. the entire market is positioning for the next wave of institutional products