Cboe filed four 19b-4 requests with the US Securities and Exchange Commission to launch spot XRP ETFs.
These filings on behalf of WisdomTree Bitwise 21Shares and Canary are a crucial step towards obtaining regulatory approval for the listing and trading of these investment products.
These 19b-4 applications follow the issuers’ S-1 filings, moving the proposals closer to regulatory consideration. After the SEC confirms receipt of the application, it has 240 calendar days to evaluate the ETFs.
Ripple CEO Brad Garlinghouse responded to the filings with a clock emoji, suggesting the regulator’s decision is on the horizon. Garlinghouse previously said that an XRP exchange-traded fund (ETF) was inevitable. It is therefore not surprising that investors expect such products to be approved.
Ripple said that a wave of ETF application from many different issuers reflects XRP’s growing interest among institutional investors.
ETF filing details
The proposed XRP-ETFs will follow the price of XRP – the fourth biggest crypto in terms of market capitalization.
Cboe states that participants authorized to transact in XRP will refrain from doing so during the ETF’s creation and redemption. Instead, the structure ensures exposure to XRP’s price movements without requiring fund managers to buy or hold the asset directly.
The application also compares the process for approving spot Bitcoin ETFs and Ethereum ETFs.
Cboe stated that even though XRP did not have a CME-based futures exchange, SEC has approved Bitcoin and Ethereum Exchange Traded Funds despite CME’s futures for the assets being not considered. “significant size.”
According to the filing, there are other ways of reducing fraud and market-manipulation risks. Therefore, a surveillance sharing agreement is not necessary for XRP Exchange Traded Funds.
It stated that:
“There are sufficient ‘other means’ of preventing fraud and manipulation that warrant dispensing of the surveillance-sharing agreement with a regulated market of significant size, as was done with both Spot Bitcoin ETPs and Spot ETH ETPs, and that this proposal should be approved.”
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