US spot XRP ETFs have doubled their holdings since the start of the year, nearing $200 million, and 21Shares says four factors explain the renewed institutional demand. The firm points to XRP's legal clarity, fresh ETF liquidity, on-chain turnover and fixed supply, while flagging one caveat on how banks actually use the token.
US spot ETFs holding XRP have doubled their positions since the beginning of the year, bringing total investments to nearly $200 million. Asset manager 21Shares has laid out four specific reasons behind the buying, arguing the market has now absorbed the consequences of years of litigation.
Legal clarity removes the compliance risk
The first reason is XRP's legal status in the United States, secured after Ripple brought its SEC case to a close in August last year. That final ruling made XRP one of the few altcoins with fully clear legal standing, which 21Shares says eliminates compliance risk for conservative US funds.
ETF liquidity absorbed a major sell-off
The second reason is the launch of spot ETFs, which gave the market deeper institutional liquidity. Earlier this year, Goldman Sachs locked in profits and sold a $153.8 million XRP position, and the market absorbed the entire volume within two weeks through retail investors and smaller funds, without a noticeable price decline.
On-chain turnover backs the token with real activity
The third factor is measurable turnover on the XRP Ledger, which reached $500 billion over the past twelve months. The network now hosts the native RLUSD stablecoin with $1.6 billion in volume, plus another $4 billion in tokenized US Treasuries.
Fixed supply, but a caveat on bridge use
The fourth reason is XRP's tokenomics: supply is capped at 100 billion, with no technical way to issue more. Ripple has also permanently burned 14 million XRP through transaction fees, and its public escrow release schedule is designed to protect holders from sudden dilution.
However, 21Shares notes that high network activity does not automatically push the price higher. Large banks often use XRP only as a bridge asset, buying it for a single instant transfer and selling it immediately afterward without holding it on their balance sheets.
Together, these four reasons have shifted how Wall Street views XRP, moving it from a token clouded by litigation toward a regulated way to gain exposure to the digitalization of the financial system.
Source: U.Today
Trading involves risk.
Risk Disclaimer
