Regulatory scrutiny intensifies surrounding spot ETF proposals amid ongoing legal battles and market manipulation concerns.
Key Takeaways
- The SEC will decide on the Grayscale XRP ETF by October 18, 2025, after a 240-day review process.
- The ETF conversion faces hurdles due to XRP’s legal status and the SEC’s cautious approach to altcoin ETFs.
The Securities and Exchange Commission will decide on Grayscale’s proposed XRP ETF by October 18, 2025, following the filing’s official posting to the Federal Register today.
🚨NEW: @Grayscale’s $XRP ETF (19b-4 filing) has officially been posted to the Federal Register.
All this means is that the clock starts now for the @SECGov to engage and either approve or deny on or before October 18. pic.twitter.com/dhMSvOcSXF
— Eleanor Terrett (@EleanorTerrett) February 20, 2025
The posting initiates a 240-day review timeline, during which the SEC must approve, deny, or extend its evaluation of the application.
The process began with the SEC’s February 14 acknowledgment of the filing.
The regulatory review involves a 21-day public comment period for stakeholders to submit feedback on the proposal. Following this, the SEC will assess the comments and conduct its analysis within the required timeframe.
As part of the review, the SEC will evaluate compliance with securities laws, assess market integrity, identify potential manipulation risks, and examine custody arrangements and investor protections.
The application faces several regulatory hurdles.
XRP’s legal status remains under scrutiny due to ongoing litigation between Ripple Labs and the SEC regarding whether XRP constitutes a security.
Additionally, the SEC has demonstrated greater caution toward altcoin ETFs compared to Bitcoin ETFs, citing increased market manipulation risks.
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