Franklin Templeton filed S-1 form for XRP ETF

Investment company Franklin Templeton was the latest to file for the launch of a new ETF based on the XRP token. Franklin Templeton filed an S-1 form in an effort to bring an alternative source of XRP investments.

Franklin Templeton, one of the world’s leading investment managers, aims to expand the available ETF based on digital assets with an XRP-based fund. The filing comes at a moment of fearful market sentiment, where altcoins are seen as much riskier. XRP, however, tries to stand out as an asset with utility for the global finance ecosystem.

The fund’s shares have been designed to replace an investment in XRP through crypto exchanges, including the need to self-custody XRP in a wallet.

The Shares aim to reflect the intrinsic value of XRP, while providing an alternative way of achieving exposure. Franklin Templeton targets those that are more comfortable with the stock market than crypto holdings. 

As with other ETFs, the new fund will derive its price from the CME CF XRP-Dollar Reference Rate. The fund’s shares will also be created and redeemed in predetermined batches, only by Authorized Participants.

After the latest filing, Franklin Templeton joins the growing list of attempts to build a specialized XRP fund. Other filings came from Bitwise, 21Shares, Canary Capital, Grayscale, and Wisdom Tree. After Franklin Templeton’s attempt, XRP has a total of 17 ETF proposals in various stages of discussion and approval. The latest inclusion of Franklin Templeton is part of the fund’s toolset in connecting crypto and traditional finance. 

The intended fund, if approved is expected to trade on the CBOE BZX Exchange. The XRP underlying the shares would be held by Coinbase Custody, as is the usual approach of Franklin Templeton. To launch trading, Franklin Templeton registered the Trust for the ETF as a Delaware statutory trust on February 28, 2025, and the Trust will operate as an emerging growth company under the JOBS Act.

The fund’s purpose will be to give exposure to XRP as an underlying asset. The ETF’s asset mix will include both XRP tokens and cash in a predetermined ratio. Franklin Templeton will serve as the fund’s Sponsor, but will not be liable for extraordinary expenses, such as lawsuits or other unusual claims. The investment company will take over some recurring fees and expenses related to the fund.

XRP remains the fourth largest crypto asset by market capitalization, after staging its recovery from a prolonged bear market. XRP rallied after the US SEC abandoned its prolonged lawsuit on the status of XRP as an unregistered security. The token rallied from its range-bound trading under $0.50 close to $2. Currently, XRP trades around $2.20, retaining some of the recent gains. XRP also expanded after being mentioned as one of the potential assets to be included in a US strategic crypto reserve.

The S-1 filing advances the process to the next stage, which is the SEC’s response and comments, but it does not instantly result in the fund receiving approval.  

SEC remains cautious about new ETF

The US SEC took its time to approve BTC and ETH funds, with multiple delays. Multiple other assets have been proposed and are in various stages of approval. XRP, despite the detailed filings, remains a distant possibility. 

The SEC may take months of deliberation and comments before even one of the funds starts trading. XRP currently derives most of its liquidity from direct trading and demand. The token has seen some mainstream adoption due to earlier partnerships with Ripple and early XRP airdrops. 

The SEC has repeatedly delayed alternative exchange-traded funds (ETFs) based on altcoins, such as SOL, LTC, DOGE, and others. In spite of this, the regulator examines every submission, including the most recent ETF built on the Hedera Hashgraph (HBAR). 

ETF are generally considered a way to bring Wall Street into crypto investment. However, the launch of ETF has not been as favorable for Ethereum (ETH). XRP is also held in multiple legacy wallets and has been distributed widely. The only scarcity comes from XRP burns for operations, although the token is not necessary to Ripple’s decentralized ledger technology.

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