Grayscale XRP ETF Faces SEC Review with October Deadline

• The SEC’s 240-day investigation of Grayscale’s XRP ETF is currently underway.
• Following regulatory changes, the possibility of XRP ETF approval has increased to 81%.

The United States Securities and Exchange Commission (SEC) has officially approved the Grayscale bid to reclassify its XRP Trust as an ETF based on a spot exchange-traded product. NYSE Arca filed on January 30th, initiating a 240-day review cycle before a decision must be made by October 18, 2025.

The SEC approval was released in the Federal Register on February 13, a 21-day comment period. This will enable investors and industry participants to comment before the regulatory authority moves forward with additional assessments.

Grayscale’s XRP ETF Under SEC Fire During Time of Regulatory Change

The SEC will concentrate on investor protection, market manipulation risks, and the regulatory status of XRP itself. The XRP token is the target of a Ripple Labs-SEC lawsuit that will have implications for approval of the ETF. Historically, the SEC has been reticent concerning altcoin ETFs, out of fear of price manipulation.

Grayscale is one of six issuers applying for XRP ETF approval, with Bitwise, Canary Capital, 21Shares, WisdomTree, and CoinShares. The Federal Register will soon publish the filings, indicating increasing demand for altcoin-based ETFs.

SEC regulatory feedback and management updates, including the SEC’s appointment of Acting Chair Mark Uyeda, have fueled increasing optimism for approval for altcoin ETFs. As investors’ sentiment improved, the chances of an XRP ETF listing in 2025 were upgraded to 81%.

Grayscale has been at the forefront in pressing for crypto ETFs, and in essence, has converted its Bitcoin Trust to a spot Bitcoin ETF. The situation with the SEC regarding altcoin ETFs, however, remains uncertain. Altcoin products remain under tighter parameters regarding liquidity, manipulation, as well as concerns about regulatory clarity, although they have also seen approval, unlike Bitcoin-based ones.

With the October 18 deadline approaching, market players are actively preparing for the decision. Adoption would lead to higher trading and adoption volume. A rejection or delay would prompt further negotiations with regulators and impact future submissions. Regardless of the outcome, the decision will shape the future of crypto ETFs and influence investment strategies in the digital asset class.