Franklin XRP Fund Lands on Cboe: Crypto Invades Traditional Trading Turf
Published Date: 3/19/2025
Notice
Summary
The Cboe BZX Exchange wants to start listing and trading shares of the Franklin XRP Fund, a new ETF tied to the cryptocurrency XRP. This change lets investors buy and sell these shares on the exchange, opening up fresh opportunities in crypto investing. The proposal was filed on March 13, 2025, and is now open for public comments before it can go live.
Analyzed Economic Effects
6 provisions identified: 5 benefits, 0 costs, 1 mixed.
New XRP ETF May Trade on Cboe BZX
Cboe BZX filed on March 13, 2025 to list and trade shares of the Franklin XRP Fund, an exchange-traded fund that would hold spot XRP and cash. The Trust filed a Registration Statement on Form S-1 on March 11, 2025 (File No. 333-285706), and the Shares will not trade until that Registration Statement is effective.
Custody Uses Coinbase Cold Storage
Coinbase Custody Trust Company, LLC will custody the Fund's XRP and will store private keys in cold storage with restricted individual access so that no single Sponsor executive can access the keys. The XRP Custodian states it uses operational and cryptographic controls to reduce the risk of loss or theft.
Creation/Redemption Size and Premium/Discount Risk
The Fund will create and redeem Shares in Creation Baskets of 50,000 Shares; cash creation orders must be placed by 2:00 p.m. ET and in-kind orders by 4:00 p.m. ET. The filing notes Shares may trade at a premium or discount to NAV and authorized participants can create or redeem baskets in kind or for cash, which affects intraday liquidity and potential trading costs for investors.
Fund Holds Only Spot XRP and Cash
The Franklin XRP Fund would hold only spot XRP, cash, and cash equivalents and seeks to reflect the price of XRP as of 4:00 p.m. ET each trading day. The Fund values Shares daily and will use the CME CF XRP-Dollar Reference Rate (New York Variant) as its Index.
Price Transparency: NAV and IIV Timing
The Fund will calculate NAV once daily after 4:00 p.m. ET and disseminate it to all market participants at the same time; an Intraday Indicative Value (IIV) will update every 15 seconds during Regular Trading Hours using a real-time index. Price data for XRP and index values will be available from major data vendors and the Fund's public website.
Exchange May Halt Trading for Index or NAV Interruptions
BZX may halt trading in the Shares under Rule 11.18 for market conditions or if the IIV, Index value, or NAV is not being disseminated as required; the Exchange will halt trading no later than the next trading day if an interruption persists. Halts can also occur if trading in the underlying XRP is not occurring or other unusual conditions exist.
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