Grayscale, the company that manages cryptocurrency trusts, has announced the launch of the XRP Trust, which has resulted in an 8% increase in the coin's value. The price surged to $0.58, although it remains far from its all-time high of $3.84 reached in 2018, prior to the legal actions initiated by the U.S. Securities and Exchange Commission (SEC).
The new private fund will offer accredited investors a direct opportunity to invest in XRP.
Grayscale had previously offered an XRP Trust but was forced to dissolve it in 2021 after the SEC filed a lawsuit against Ripple
Also known as Ripple Labs, this company specializes in blockchain technology and developed the XRP Ledger. in 2020, accusing the company of selling XRP as unregistered securities.
“We believe that Grayscale XRP Trust gives investors access to a protocol with real applications,” stated Ryan Sharif-Askari, head of products and research at Grayscale. “XRP has the potential to transform traditional financial infrastructure by facilitating international payments in seconds.”
The XRP Trust will operate similarly to other single-asset investment funds offered by Grayscale.
Despite this positive news for Ripple regarding XRP, a federal court ordered the company to pay $125 million in August after it was determined earlier this year that Ripple violated federal securities laws by directly selling XRP to institutional clients. This is substantially less than the initial demand by the SEC for $2 billion.
What’s Next for XRP?
The new XRP Trust from Grayscale could be a significant step towards the institutionalization of XRP, potentially paving the way for the launch of an ETFAn investment fund that trades on an exchange like stocks. In simple terms, it’s a type of financial instrument that allows investing in a whole set of assets (stocks, bonds, cryptocurrencies, etc.) by purchasing one fund, instead of buying each individual asset.. This (very likely) will attract more attention from both institutional and retail investors who have been waiting for more regulated investment opportunities in the cryptocurrency market.
Additionally, Republican members of the U.S. Congress have begun an investigation into SEC Chair Gary Gensler over suspicions of political bias in hiring executives. Gensler is accused of appointing Dr. Haoyang Zhu as the SEC's Director of Trading and Markets based on his political ideology, which may violate the 1978 Civil Service Reform Act. Gensler has been ordered to provide the relevant documents by September 24, 2024.
In an August interview, former Ripple director Sean McBride hinted that the Biden administration, led by Gary Gensler and Elizabeth Warren, may have intentionally been suppressing the price of XRP.
Consequently, the further development of Grayscale XRP Trust and its potential conversion into an ETF, along with the future resolution concerning the SEC Chair, will evidently have a significant impact on the value of XRP.
Source: Youtube,Grayscale Investments, House Judiciary Committee Republicans
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