Jupiter Asset Management’s internal compliance team has decided to withdraw its investment in the 21Shares Ripple XRP exchange-traded product (ETP) due to regulatory issues in Ireland. The initial investment amounted to over $2 million, resulting in a loss of $834.
According to a recent report from the Financial Times, Jupiter invested $2,571,504 into the 21Shares Ripple XRP ETP (AXRP) in the first half of 2023. However, the exact date of the initial investment was not specified. Over the past year, the ETP has yielded a return of 31.7%, but it has declined by 13.2% in the last six months.
The AXRP ETP tracks the performance of XRP, having been launched in March 2019. As stated on the 21Shares website, the ETP currently manages assets worth $50,497,518.
The report explained that asset managers operating under Ireland’s Undertakings for Collective Investment in Transferable Securities Directive (UCITS) are not allowed to have exposure to cryptocurrencies. When Jupiter’s compliance team discovered the trade in one of its Irish UCIT funds, the company sold off the investment. Jupiter liquidated its Ripple XRP ETP holding for $2,570,670, resulting in a loss of $834.
This decision comes amidst ongoing discussions about the potential approval of an XRP exchange-traded fund (ETF), especially after the recent approval of 11 spot Bitcoin ETFs by the United States Securities and Exchange Commission (SEC). However, due to the legal dispute between Ripple and the SEC regarding the classification of XRP as a security, some analysts speculate that the approval of an XRP ETF may be unlikely.
Earlier this year, CoinShares’ head of product, Townsend Lansing, stated that an XRP ETF would not be feasible unless the SEC is forced to acknowledge that XRP is not a security. On the other hand, Brad Garlinghouse, CEO of Ripple, believes that the recent approval of several spot Bitcoin ETFs in the United States will pave the way for more crypto ETFs in 2024. However, he did not explicitly predict the approval of an XRP ETF by the SEC, although he expects an Ethereum ETF to be approved soon.
In other news, Crypto Banter’s Ran Neuner has expressed his negative opinion about Ripple, describing it as “despicable” and giving credit to ZachXBT in the Hall of Flame.