XRP exchange-traded funds are showing signs of becoming a bigger part of the U.S. financial market, with XRP ETF shares appearing in institutional collateral arrangements while the funds also continued to attract new investor money.
On Sept. 8, a regulatory filing showed eight XRP ETF collateral positions worth about $11.39 million in total. On the same day, five XRP ETFs tracked by SoSoValue brought in nearly $2 million in net inflows.
The Schwab filing does not mean Charles Schwab bought XRP ETFs as an investment. Instead, the ETF shares were used as collateral in repurchase agreements, or repos, involving Schwab’s money market fund and two major financial firms.
The filing showed XRP ETF shares from Bitwise, Canary Capital, Franklin Templeton and Grayscale being used as collateral. JPMorgan Securities accounted for about $7.20 million of the collateral, while BofA Securities accounted for about $4.19 million.
In a repo transaction, one side provides cash while the other provides securities as collateral and agrees to buy them back later. So the filing shows that XRP ETF shares were accepted as collateral, but it does not prove that Schwab was directly investing in XRP or XRP ETFs.
The disclosure is also different from an institutional ownership report such as a Form 13F, which shows qualifying securities held by investment managers.
At the same time, XRP ETFs continued to see positive investor demand.
The five XRP products tracked by SoSoValue attracted nearly $2 million in net inflows on Sept. 8, while their combined cumulative inflows reached about $1.69 billion. The funds had also attracted around $173 million over the previous 30 days.
That performance stood out because larger U.S. crypto ETF categories were moving in the opposite direction.
Spot Bitcoin ETFs recorded about $46.65 million in combined net outflows on Sept. 8. Grayscale’s GBTC saw the biggest withdrawals at roughly $65.51 million, although inflows into several other Bitcoin ETFs helped reduce the overall loss.
The XRP ETF numbers and the collateral data point to two different developments. ETF inflows show that investors are putting new money into the products, while the Schwab filing shows that XRP ETF shares are being accepted as collateral in financial transactions.
Together, the developments show that XRP ETFs are gaining a wider presence in the U.S. financial system, although the collateral disclosure should not be viewed as direct evidence of institutional investment in XRP.
