Is XRP ETF Facing Rejection?

The U.S. Securities and Exchange Commission (SEC) has paused its review process, citing a temporary government shutdown—not a denial of the filings.

XRP ETFs face delay in approval that comes from a temporary pause by the U.S. Securities and Exchange Commission (SEC) during the government shutdown. Filings from major asset managers such as Grayscale, Bitwise, WisdomTree, Franklin Templeton, 21Shares, CoinShares, and Canary Capital are simply on hold until federal operations resume. Their applications are part of a broader wave of crypto exchange-traded fund (ETF) filings meant to bring digital assets to regulated markets.

While some headlines suggest the SEC’s move signals hesitation, it’s more procedural than punitive. Once government operations resume, the review clock restarts.

Institutional Positioning: Adjusting, Not Retreating

Despite the pause, large institutional players haven’t backed away. Instead, they’re adjusting strategies to maintain exposure to XRP through futures, structured notes, and swaps.

Worth noting, the REX-Osprey XRP ETF (XRPR) has already gathered more than $100 million in assets under management, showing strong investor demand for direct exposure to XRP.

According to several analysts, funds that had earmarked allocations for XRP ETFs this quarter have kept those budgets intact, waiting for new SEC timelines.

Institutional sentiment remains bullish:

• Surveys show strong institutional interest in XRP once ETFs are approved.
• Analysts predict approval could still arrive before December 2025.
• Some expect an initial $5–8 billion inflow in the first month after launch, possibly reaching $18 billion by year-end.

The delay has, if anything, reinforced the sense that the XRP ETF is a matter of “when,” not “if.”

The SEC’s Careful Approach

ETF approvals follow strict timelines. The SEC typically reviews filings in defined windows, but those windows are extended during government shutdowns or policy reviews.

For XRP, the current delay appears tied to the agency’s broader effort to align altcoin ETF classifications with its evolving framework for digital assets.

Historically, both Bitcoin and Ethereum ETFs faced similar pauses before eventual approval. When those assets finally received green lights, markets initially dipped from uncertainty—then rebounded strongly once clarity arrived.

That pattern may be repeating with XRP.

A Coordinated Setup Around November

Many analysts believe the real story isn’t rejection—it’s coordination.

November 6, 2025, is emerging as a key regulatory milestone. That date aligns with the expected conclusion of SEC consultations on altcoin classifications and ETF review extensions.

If those reviews conclude as planned, XRP could be among the first altcoins positioned for ETF inclusion under the new framework.

Crypto researcher Ripple Bull Winkle suggested the delay is strategic rather than random.

“If you ask me, it’s not random; that is very strategic because, think about when the regulatory clarity clock runs out. ” he said in a video on X. “Bitcoin, Ethereum, XRP, and Solana — they already told you which ones that day are setting up for. So why delay unless you already know what’s coming?”

In his view, major issuers are synchronizing product launches with the SEC’s finalization of digital asset rules.

Ripple’s Broader Institutional Push

While the ETF process unfolds, Ripple has continued to expand its financial infrastructure initiatives.

1. Stablecoin Development

Ripple’s new RLUSD stablecoin is backed by BNY Mellon, one of the oldest custody banks in the U.S. This integration allows Ripple to link its stablecoin directly to ETF systems, improving settlement speeds and bridging crypto with traditional finance.

2. Bank Partnerships

Ripple is also working with State Street and other institutions on money market tokenization projects. These initiatives use ISO 20022, the same global messaging standard that powers XRP’s payment network. That compatibility could ease XRP’s inclusion in regulated financial systems once ETFs are approved.

XRP Market Activity Remains Strong

Even without a U.S. ETF, XRP trading has remained robust.

• CME XRP futures continue to see billions in open interest, reflecting steady institutional exposure.
• In Europe, XRP exchange-traded products (ETPs) already trade under the MiCA regulatory framework, giving investors indirect access while the U.S. process continues.

Alternative Routes to Exposure

Institutions eager to hold XRP are finding other ways to integrate it into portfolios.

They are using:

• Structured notes tracking XRP’s spot price.
• Swaps and derivatives for synthetic exposure.
• Cross-border payment systems that leverage XRP as a settlement asset.

This approach lets them stay active without waiting for the ETF’s green light.

Regulatory Alignment on the Horizon

The SEC and the Commodity Futures Trading Commission (CFTC) are now coordinating more closely on crypto oversight. This inter-agency alignment may provide the policy clarity necessary for ETF approvals across digital assets like XRP, Solana, and Ethereum.

Globally, regulators are also moving toward standardized digital asset frameworks. Japan’s SBI Holdings, for example, has already filed for a Bitcoin–XRP ETF, showing confidence in XRP’s legal clarity after U.S. courts declared it not a security.

These international developments suggest the groundwork is being laid for cross-border ETF products that align with both U.S. and global regulations.

Why the Delay Matters

The XRP ETF delay highlights how cautious U.S. regulators remain with altcoins. While Bitcoin and Ethereum ETFs benefited from clearer definitions, XRP operates in a middle ground—recognized as a non-security by courts but still under review by the SEC for exchange-traded status.

That said, delays can also serve a purpose. They allow regulators to align frameworks and ensure that once ETFs are approved, they stay compliant and scalable under long-term policy.

For institutions and retail investors alike, this approach could offer a more stable foundation once ETFs finally launch.

Conclusion

Ripple’s XRP ETF is not facing rejection—it’s simply caught in a temporary regulatory pause. The SEC’s delay reflects procedural caution, not disapproval.

Institutional interest remains strong, market activity is steady, and infrastructure around custody, stablecoins, and tokenization continues to expand.

As November approaches, the alignment between issuers, regulators, and Ripple’s ecosystem suggests something broader is at play.

If the green light finally comes, XRP could be positioned with the infrastructure, partnerships, and compliance groundwork already in place.

Resources:

1. REX-Osprey XRP ETF (XRPR) Surpasses $100M in Assets Under Management - report by CoinDesk: https://www.coindesk.com/markets/2025/10/25/first-u-s-spot-xrp-etf-surpasses-usd100m-in-assets-under-management

2. SBI Holdings Financial Results for Q2 2025: https://www.sbigroup.co.jp/english/investors/disclosure/presentation/pdf/250731presentations.pdf

3. Announcement - Ripple Selects BNY to Custody Ripple USD Reserves: https://www.bny.com/corporate/global/en/about-us/newsroom/press-release/ripple-selects-bny-to-custody-ripple-usd-reserves.html