Jupiter Asset Management's internal compliance team has reportedly divested its investment in the 21Shares Ripple XRP exchange-traded product (ETP) due to regulatory concerns in Ireland. The firm initially allocated over $2 million to the fund, experiencing a loss of $834 in the process.
The investment, totaling $2,571,504, was made in the 21Shares Ripple XRP ETP (AXRP) during the first half of 2023, as per a recent report by the Financial Times. Although the exact date of the initial investment remains unspecified, the ETP has recorded a one-year return of 31.7%, alongside a six-month decline of 13.2%.
AXRP, which tracks the performance of XRP and was launched in March 2019, boasts assets under management (AUM) amounting to $50,497,518, according to the 21Shares website.
Under Ireland's Directive on Collective Investment in Transferable Securities (UCITS), asset managers are prohibited from exposure to cryptocurrencies. As such, Jupiter sold its Ripple XRP ETP holdings at $2,570,670 after its compliance team identified transactions conflicting with regulations in one of its Irish UCIT funds, resulting in the aforementioned loss of $834.
Despite ongoing discussions regarding the potential approval of XRP exchange-traded funds (ETFs), recent approval of 11 spot Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) has sparked speculation. However, analysts suggest hurdles may persist due to the legal dispute between Ripple and the SEC over XRP's classification as a security.
While Ripple CEO Brad Garlinghouse views the approval of spot Bitcoin ETFs as paving the way for more crypto ETFs in 2024, he refrains from explicitly predicting SEC approval for an XRP ETF. Nonetheless, he expresses optimism regarding the potential approval of an Ethereum ETF in the near future during a recent interview with CNBC.
