U.S. Spot XRP ETFs Smash Records, Nearing $1 Billion Inflows After Explosive Launch

Wall Street's latest crypto gamble just hit the jackpot. U.S. spot XRP exchange-traded funds (ETFs) are barreling toward a staggering $1 billion in investor cash, following a debut that shattered expectations.

The $1 Billion Magnet

Forget a slow burn—this was a detonation. The flood of capital into these newly minted funds signals a seismic shift in institutional appetite. Traders aren't just dipping a toe; they're diving headfirst into XRP's liquidity, betting big on its legitimacy post-regulatory clarity. The near $1 billion figure isn't just a number; it's a statement that asset managers are finally playing for keeps.

Beyond the Hype Cycle

This isn't mere speculation. The inflows point to a concrete strategy: providing mainstream investors a regulated, familiar vehicle to gain exposure without the hassle of private keys and wallet addresses. It's finance's oldest play—repackaging an asset for a new audience—and it's working. Yet, it begs the question of whether this legitimizes the asset or simply creates a more efficient casino for the usual Wall Street suspects.

A provocatively balanced closer: The $1 billion milestone proves digital assets are now irreversibly woven into the fabric of high finance. Whether this marks a new dawn for efficient cross-border value transfer or just another fee-generating product for the suits, however, remains to be seen. After all, Wall Street has a knack for turning revolutions into revenue streams.

US crypto law changes Wall Street’s view on altcoins

Ripple and its native token XRP had hit a regulatory bump with the US Securities and Exchange Commission before US President TRUMP started his second term. After 2023, when Judge Analisa Torres ruled that XRP is not a security, the SEC sent several appeals to reverse the court ruling, causing the case to stall for over two years.

However, after the SEC underwent a leadership change and the Trump administration ended its “regulation by enforcement” tenure, Ripple was ordered to pay a $125 million fine in August, finally bringing the lawsuit against them to a close. That, according to Greenspan, was the outcome that removed the negative notion institutions had of XRP.

“Institutions are responding to its newfound regulatory clarity, its current market position and long operational history. XRP hasn’t shown the same pace of innovation or user-driven traction as some of the newer networks, but legacy matters,” he continued.

The steady inflows in spot XRP funds have persisted during a period of market declines in the crypto ETF market. Bitcoin and Ether investment vehicles had a forgettable November, with the former recording over $3.7 billion redemptions as Bitcoin consolidated between $86,000 to $94,000 during the month. 

XRP ETF issuers relied on over-the-counter trading desks to manage liquidity during the October and November selloff. According to a report from Investing, OTC channels helped stabilize creation and redemption flows enough for XRP products to attract “higher-quality institutional capital” than BTC and ETH ETF launches.

Ripple’s $500 Million share sale flocked by Wall Street heavyweights

Ripple’s $500 million share sale in November brought close big Wall Street players, including Citadel Securities LLC and Fortress Investment Group. The transaction valued Ripple at $40 billion, the highest valuation for a privately held crypto firm.

According to people with knowledge of the transaction, two funds assessed that more than 90% of Ripple’s net asset value was tied to XRP. Company disclosures showed Ripple held $124 billion worth of XRP as of July, with much of it locked and released gradually.

The group of backers, alongside funds linked to Marshall Wace, Brevan Howard, Galaxy Digital, and Pantera Capital, secured mechanisms to help Ripple’s valuation have a minimum upside. 

Still, XRP has fallen about 34% from its three-month high of $3.18, and has dropped more than 40% from its mid-July high. Ripple, on the other hand, has been busy running several business lines, including a stablecoin division and a prime brokerage operation.

Ripple’s funding round comes on the backdrop of several crypto companies raising funds for operations and IPOs. About $23 billion was garnered from venture capital rounds and public listings, according to PitchBook. 

The records exclude Tether Holdings SA seeking up to $20 billion from SoftBank Group Corp. and Ark Investment Management LLC, Bloomberg reported.

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