The price of the XRP token soared on Thursday after Grayscale announced the launch of a new trust that will give accredited investors direct exposure to the cryptocurrency.
Ripple XRP was last up more than 4.7% to 56 cents per coin, according to CoinMetrics. It had risen 9% prior to that. Created by the founders of Ripple, XRP is the native token of the open-source XRP Ledger that Ripple uses for its international payments business. It is the fifth-largest coin by market capitalization, excluding stablecoins. Tether (USDT) and USDC.
Unlike exchange-traded funds, trusts trade primarily over-the-counter and are more likely to trade at prices that are inconsistent with the underlying value of their portfolios.
“As crypto investors diversify beyond Bitcoin and Ethereum, we see value in providing exposure to protocols that solve real-world problems,” Reihaneh Sharif Askari, head of product and research at Grayscale, said in a statement shared with CNBC. “XRP can reduce friction in international payments and increase efficiency in the evolving global economy.”
Ripple, the largest holder of the XRP coin, won a partial victory last summer after a three-year battle with the Securities and Exchange Commission. U.S. District Judge Analisa Torres ruled that XRP is not considered a security when sold to retail investors on exchanges, but is considered an unregistered securities instrument when sold to institutional investors. This was hailed as a landmark victory for the cryptocurrency industry.
Grayscale also made history shortly after, when a court ruled that the SEC erred in denying the crypto investment giant permission to convert its popular Bitcoin Trust into an ETF. The SEC approved the necessary rule changes in January. The Grayscale Bitcoin Trust and Grayscale Ethereum Trust began trading as ETFs in January and July of this year, respectively.
Major cryptocurrencies were flat on Thursday. Bitcoin The final transaction price was $58,388. ether $2,347.48. MicroStrategy It increased by more than 1%. Coinbase It increased by 4%.
—CNBC’s Jesse Pound contributed reporting.
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