Canary Capital Files for Spot XRP ETF, Second Bid After Bitwise’s Recent Application

• Canary Capital files for spot XRP ETF, second in a week, joining Bitwise’s application for SEC approval.
• The Canary XRP ETF avoids derivatives, using CME CF Ripple Index to track XRP’s price, reducing potential risks.
• Regulatory challenges remain as the SEC continues its legal battle with Ripple Labs over XRP’s status as an unregistered security.

Crypto investment firm Canary Capital has officially filed for a spot XRP exchange-traded fund (ETF) with the U.S. Securities and Exchange Commission (SEC). This filing is the second such submission in the past week, following Bitwise’s similar application on October 2. If either is approved, it would become the first spot XRP ETF in the U.S., offering investors a new way to access the XRP market without directly holding the token.

Canary Capital’s Filing and Details of the XRP ETF

On October 8, Canary Capital submitted Form S-1 to the SEC, outlining their plans for the “Canary XRP ETF.” This product aims to give investors access to XRP through a traditional brokerage account, eliminating the need to directly buy or store the digital asset. 

According to the filing, the ETF will track the real-time price of XRP using the CME CF Ripple Index, a benchmark created by the Chicago Mercantile Exchange (CME). Importantly, Canary emphasized that their ETF will avoid using derivatives, thereby reducing counterparty and credit risks.

Founder’s Insight and Focus on Blockchain Solutions

A key figure behind Canary Capital’s XRP ETF filing is Steven McClurg, the former Chief Investment Officer and co-founder of Valkyrie Fund. McClurg, who previously launched Bitcoin and Ethereum ETFs, pointed out the increasing interest in enterprise-level blockchain solutions. In a recent statement, he said,

We’re seeing encouraging signs of a more progressive regulatory environment, along with growing demand from investors seeking access to blockchain-native tokens like XRP.

This interest reflects a broader trend in the crypto market, as investors look for exposure to tokens beyond Bitcoin and Ethereum.

Potential Regulatory Hurdles Facing XRP ETFs

Although Canary Capital and Bitwise have both filed for spot XRP ETFs, regulatory challenges remain. One major obstacle is the ongoing legal battle between the SEC and Ripple Labs, the issuer of XRP. The SEC has appealed its lawsuit against Ripple, claiming that XRP is an unregistered security and accusing the company of raising $1.3 billion through its sale.

Despite these challenges, the two filings indicate growing interest in providing institutional access to XRP through traditional financial markets. Whether the SEC will approve either application remains uncertain.