The U.S. Securities and Exchange Commission (SEC) has concluded its public comment period for the WisdomTree XRP Spot ETF and is now advancing to a formal review phase, leaving the approval decision pending. Here's a detailed breakdown of the key developments:
Timeline and Process Overview
- February 19, 2025: SEC officially accepted WisdomTree's XRP ETF application, initiating a 45-day public comment window.
- Current Status: The comment period has closed, triggering the SEC's extended review authority, which permits up to 240 days of evaluation.
- Final Deadline: A conclusive decision must be issued by October 31, 2025.
Regulatory Framework Insights
- The SEC employs a multi-stage review system for ETF applications, balancing market innovation with investor protection.
- Public feedback plays a pivotal role, allowing regulators to assess market sentiment and potential risks.
Key Factors Under SEC Scrutiny
- XRP's Regulatory Classification: Ongoing ambiguity around XRP's status as a security remains a critical hurdle.
- Market Liquidity: WisdomTree must demonstrate sufficient XRP market depth to support ETF operations.
- Custodial Solutions: Robust asset storage mechanisms are mandatory for SEC approval.
👉 Track real-time ETF approval updates
Industry Implications
- A greenlighted XRP ETF could legitimize Ripple's native token post-2020 legal battles.
- Competitive Landscape: Similar applications from BlackRock and Fidelity may accelerate if WisdomTree succeeds.
FAQ Section
Q: How long does the SEC typically take to approve crypto ETFs?
A: Historic approvals (e.g., Bitcoin ETFs) averaged 18-24 months from application to decision.
Q: What happens if the SEC rejects WisdomTree's proposal?
A: The firm may resubmit after addressing deficiencies or pursue legal appeals.
Q: How does this affect XRP's price volatility?
A: Expect short-term speculation during the review period, but long-term stability hinges on final outcomes.
👉 Explore XRP trading strategies during regulatory uncertainty
Conclusion
While WisdomTree's proposal marks a milestone for crypto-backed ETFs, the SEC's deliberate pace underscores persistent regulatory complexities. Market participants should monitor:
- SEC hearing schedules
- Amicus briefs from financial institutions
- Ripple's ongoing SEC litigation developments