A cryptocurrency asset manager based in Switzerland, 21Shares, has reportedly removed Ripple’s digital token XRP from its exchange-traded products (ETPs).
As the report has it, the affected products are 21Shares’ flagship HODL or Crypto Basket Index ETP, KEYS or Bitwise Select 10 ETP, and AXRP, a single-asset ETP tied to XRP.
What Birthed This Move?
The new development can be simply attributed to the recent lawsuit filed by the United States Securities and Exchange Commission (SEC) against Ripple and its executives, Chris Larsen and Brad Garlinghouse.
SEC accused Ripple and its executives of raising billions of dollars via the unregistered sale of the digital token XRP. Meanwhile, Ripple has been waiting for the past couple of years to know the regulatory status of XRP in terms of being a security or not.
21Shares CEO Reacts to the New Development
The move raised concerns regarding the fact that 21Shares has none of its ETPs listed on the United States exchanges, indicating that the filing has no impact on the crypto asset manager.
For clarification, the CEO of 21Shares, Hany Rashwan, told The Block that the index rules of the company prohibit “any token that is a security and any token that might have liquidity issues.”
HE further added that “The risk on both sides is high, especially with a number of large over-the-counter (OTC) trading desks exiting the XRP market, specifically Jump Trading and Galaxy Digital,”
Several Exchanges Have Halted Support for XRP since the Lawsuit
A number of exchanges and crypto-related firms have decided to halt their support for XRP since the lawsuit was brought to the public notice.
Jump Trading and Mike Novogratz’s Galaxy Digital have announced the suspension of their alliance with XRP till further notice. While crypto exchanges such as Bitstamp, OSL, CrossTower, and Beaxy have followed suit. Last week, Crypto asset manager Bitwise also liquidated the XRP position of its crypto index fund.
Basically, the lawsuit is still an allegation. It’s left for the courts to decide. But the move is already having a significant impact on the Ripple and XRP ecosystem at large.