The first exchange-traded fund giving U.S. investors exposure to XRP had a roaring debut Thursday, bringing in close to $38 million in inflows in the best ETF launch of this year.
Rex Shares and Osprey Funds' XRP ETF surpassed expectations as investors rushed to get exposure to the cryptocurrency.
The issuers' DOJE ETF, the first Dogecoin ETF to trade in U.S. markets, generated a strong $17 million in its inaugural day.
The two funds' success indicated pent-up demand for altcoin exposure, Bloomberg Senior ETF Analyst Eric Balchunas said, writing on X that it was a "good sign" for the long-list of funds the SEC has lined up for approval.
Wall Street's regulator on Wednesday signed off on new generic listing standards for commodity-based trusts which could make it easier for crypto ETFs to hit markets.
The price of XRP recently stood at $3.01 after losing more than 3% of its value over a 24-hour period, according to crypto data provider CoinGecko. Dogecoin's price stood at nearly $0.27 after dropping 6% over the same time period.
Following the massive success of the Bitcoin and Ethereum ETFs the SEC approved last year, issuers have been eager to address the increasing appetite for crypto-focused investment products. The SEC has received more than 90 applications for funds based on altcoins and combinations of tokens and strategies. BTC and ETH ETFs have generated about $57 billion and $14 billion, respectively.
The Rex Shares and Osprey Funds XRP and DOGE ETFs offer investors exposure to the two altcoins via a subsidiary registered in the Cayman Islands that is wholly owned and controlled by the fund.
Rex-Osprey launched the funds via the Investment Company Act of 1940, rather than the Securities Act of 1933 like the spot funds. The act of 1933 focuses on securities or commodities covered by the ETF, while the 1940 act regulates investment companies, such as mutual funds.
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