Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Disclosure Controls and Procedures
The duly authorized officers
of the Sponsor performing functions equivalent to those a principal executive officer and principal financial officer of the Trust would
perform if the Trust had any officers, have evaluated the effectiveness of the Trust’s disclosure controls and procedures, and have
concluded that the disclosure controls and procedures of the Trust were effective as of the end of the period covered by this report to
provide reasonable assurance that information required to be disclosed in the reports that the Trust files or submits under the Exchange
Act is recorded, processed, summarized and reported, within the time periods specified in the applicable rules and forms, and that it
is accumulated and communicated to the duly authorized officers of the Sponsor performing functions equivalent to those a principal executive
officer and principal financial officer of the Trust would perform if the Trust had any officers, as appropriate to allow timely decisions
regarding required disclosure.
There are inherent limitations
to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention
or overriding of the controls and procedures.
Exemption from Management’s Report on
Internal Control over Financial Reporting
This Form 10-K does not include
a report of management’s assessment regarding internal control over financial reporting due to a transition period established by
rules of the SEC for newly public companies.
Item 9B. Other Information
No officers or directors of the Sponsor have adopted , modified , or terminated trading plans under either a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act) during the quarter ended December 31, 2025.
Item 9C. Disclosure Regarding Foreign Jurisdictions
that Prevent Inspections
Not applicable.
66
PART III
Item 10. Directors, Executive Officers,
and Corporate Governance
The Trust does not have any
directors, officers, or employees. The following persons, in their respective capacities as directors or executive officers of the Sponsor,
a Delaware limited liability company, perform certain functions with respect to the Trust that, if the Trust had directors or executive
officers, would typically be performed by them.
Russell Barlow is CEO of the
Sponsor, Duncan Moir is President of the Sponsor, Edel Bashir is Chief Operating Officer of the Sponsor and Andres Valencia is the Executive
Vice President of Investment Management for the Sponsor.
Mr. Russell Barlow ,
52, has been the Chief Executive Officer of the Sponsor since March 2025, contributing more than 25 years of expertise in regulated asset
management. Previously, Russell was the Global Head of Multi Asset and Alternative Investment Solutions and Global Head of Alternative
Investment Solutions at abrdn plc, a global investment company (“abrdn”). Over the course of his career, he has designed,
launched and managed a wide range of investment products. Additionally, Russell has held a position as a Non-Executive Director at Archax,
the UK’s first FCA-regulated digital asset exchange.
Mr. Duncan Moir ,
40, has been the President of the Sponsor since March 2025, with deep expertise in crypto and blockchain strategy. Previously, Duncan
was a Senior Investment Manager at abrdn. He is an independent board member of Hedera Hashgraph LLC and an advisor to Web3 companies.
A University of Strathclyde graduate with a BA (Hons) in Economics, he is also a CFA and CAIA charterholder.
Ms. Edel Bashir ,
46, has been the Chief Operating Officer of the Sponsor since March 2025, with over 20 years of experience in asset management. Previously,
Edel was the COO of Multi Asset and Alternative Investment Solutions, COO of Alternatives and a Senior Investment Manager at abrdn. Her
expertise includes operation strategy, portfolio management, and hedge fund research. A graduate of University College Cork, Ireland with
a BSc in Finance, she has held senior roles across Bermuda, Dublin and Boston.
Mr. Andres Valencia ,
38, is the Executive Vice President of Investment Management at the Sponsor and a member of the Executive Committee. Before Andres joined
the Sponsor in June 2021, he was a VP of Operations at JPMorgan as part of the Beta Strategies Group and helped launch and build the company’s
ETF business. Andres has over ten years of experience managing ETFs. Andres started his career in Asset Servicing at Bank of New York
Mellon covering commodity and currency ETFs.
The Trust does not have a
code of ethics as it does not have any directors, officers, or employees.
The Sponsor has a code of
ethics (the “Code of Ethics”) that applies to its executive officers, including its Principal Executive Officer and Principal
Financial Officer, who perform certain functions with respect to the Trust that, if the Trust had executive officers would typically be
performed by them. The Sponsor’s Policies are in place and require that the Sponsor eliminate, mitigate, or otherwise disclose conflicts
of interest. Additionally, the Sponsor has adopted policies and procedures requiring that certain applicable personnel pre-clear personal
trading activity in which XRP is the referenced asset. The Sponsor has also implemented an Information Barrier Policy restricting certain
applicable personnel from obtaining sensitive information. The Sponsor believes that these controls are reasonably designed to mitigate
the risk of conflicts of interest and other impermissible activity. The Code of Ethics is available on request, free of charge, by writing
the Sponsor at etf@21shares.com or calling the Sponsor at (646) 370-6016.
Insider Trading Policy
The Trust does not have an
insider trading policy as it does not have any directors, officers, or employees.
The Sponsor has adopted an insider trading policy applicable to the Sponsor’s directors, officers and employees, which is included as an exhibit to this annual report on Form 10-K.
67
Item 11. Executive Compensation
The Trust does not have directors
or executive officers. The only ordinary expense paid by the Trust is the Sponsor Fee.
Item 12. Security Ownership of Certain Beneficial
Owners and Management and Related Stockholder Matters
Security Ownership of Certain Beneficial Owners
There are no people known
by the Trust to own directly or indirectly beneficially more than 5% of the outstanding Shares of the Trust as of March 30, 2026.
Security Ownership of Management
The Trust does not have directors
or executive officers.
Change in Control
Neither the Sponsor nor the
Trustee knows of any arrangements which may subsequently result in a change in control of the Trust.
Securities Authorized for Issuance under Equity
Compensation Plans
The Trust has no securities
authorized for issuance under equity compensation plans.
Item 13. Certain Relationships and Related
Transactions
See Item 11.
Item 14. Principal Accounting Fees and Services
Fees
for services performed by Cohen & Company, Ltd., as paid by the Sponsor from the Sponsor Fee, for the year ended December 31, 2025
and 2024 were:
2025
2024
Audit fees
$ 74,025
$ 17,500
Audit-related fees
$ -
$ -
Tax fees
$ 1,000
$ -
All other fees
$ -
$ -
Total
$ 75,025
$ 17,500
In the table above, in accordance
with the SEC’s definitions and rules, Audit Fees are fees paid to Cohen & Company, Ltd. for professional services for the audit
of the Trust’s financial statements included in the Form 10-K and review of financial statements included in the Forms 10-Q, and
for services that are normally provided by the accountants in connection with regulatory filings or engagements. Audit Related Fees are
fees for assurance and related services that are reasonably related to the performance of the audit or review of the Trust’s financial
statements.
Approval of Independent Registered Public Accounting
Firm Services and Fees
The Sponsor approved all of
the services provided by Cohen & Company, Ltd. described above. The Sponsor pre-approved all audit services of the independent registered
public accounting firm, including all engagement fees and terms.
68
PART IV
Item 15. Exhibits and Financial Statement Schedules
(a)(1) Financial Statements
See Index to Financial Statements
on page F-1.
(a)(2) Financial Statement Schedules
No financial statement schedules
are filed herewith because (i) such schedules are not required or (ii) the information required has been presented in the aforementioned
financial statements.
(a)(3) Exhibits
The following documents are
filed herewith or incorporated herein and made a part of this Annual Report:
No.
Exhibit Description
3.1
Trust Agreement (3)
3.2
Third Amended and Restated Trust Agreement (4)
3.3
Certificate of Trust (3)
3.4
Certificate of Amendment to Certificate of Trust (3)
3.5
Certificate of Amendment to Certificate of Trust (3)
3.6
Certificate of Amendment to Certificate of Trust (3)
4.1
Description of Securities (1)
10.1
Form of Sponsor Agreement (3)
10.2
Form of Authorized Participant Agreement (4)
10.3
Form of Prime Broker Agreement (3)
10.4
Form of Coinbase Custody Agreement (included as Exhibit A to Form of Prime Broker Agreement)
10.5
Form of Fund Administration and Accounting Agreement (3)
10.6
Form of Transfer Agency and Services Agreement (3)
10.7
Form of Benchmark Licensing Agreement (3)
10.8
Form of Marketing Agent Agreement (3)
10.9
Form of Cash Custody Agreement (4)
10.10
Ripple Subscription Agreement (3)
10.11
Form of Initial Seed Creation Subscription Agreement (4)
10.12
Form of BitGo Custody Agreement (3)
10.13
Form of Anchorage Custody Agreement (3)
10.14
Form of Master Authorized Participant Agreement (2)
19.1
Insider Trading Policies and Procedures (1)
23.1
Consent of Independent Registered Public Accounting Firm (1)
31.1
Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (1)
31.2
Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (1)
32.1
Certification by Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (1)
32.2
Certification by Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (1)
97.1
Executive Officer Incentive-Based Compensation Clawback Policy (1)
101.INS
Inline XBRL Instance Document.*
101.SCH
Inline XBRL Taxonomy Extension Schema Document.*
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document.*
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document.*
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document.*
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document.*
104
Cover Page Interactive Data File (Embedded as Inline XBRL document and contained in Exhibit 101).*
(1)
Filed herewith.
(2)
Incorporated by reference to the Trust’s Amendment No. 5 to Registration Statement on Form S-1, filed on December 8, 2025.
(3)
Incorporated by reference to the Trust’s Amendment No. 3 to Registration Statement on Form S-1, filed on November 7, 2025.
(4)
Incorporated by reference to the Trust’s Amendment No. 4 to Registration Statement on Form S-1, filed on November 20, 2025.
Item 16. Form 10-K Summary
None.
69
SIGNATURES
Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
21Shares XRP ETF (Registrant)
By:
21Shares US LLC, its Sponsor
Signature
Title (Capacity)
Date
/s/ Russell Barlow
Chief Executive Officer
March 30, 2026
Russell Barlow
(Principal Executive Officer)
/s/ Duncan Moir
President
(Principal Financial Officer and
March 30, 2026
Duncan Moir
Principal Accounting Officer)
Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in
the capacities* and on the dates indicated.
Signature
Title (Capacity)
Date
/s/ Russell Barlow
Chief Executive Officer
March 30, 2026
Russell Barlow
(Principal Executive Officer)
/s/ Duncan Moir
President
(Principal Financial Officer and
March 30, 2026
Duncan Moir
Principal Accounting Officer)
70
21shares
XRP ETF
index to financial statements
Page
Report of Independent Registered Public Accounting Firm (PCAOB ID 925 ) F-2
Statements of Assets and Liabilities F-3
Schedules of Investment F-4
Statements of Operations F-5
Statements of Changes in Net Assets F-6
Notes to Financial Statements F-7
F- 1
Report of Independent Registered Public Accounting Firm
To the Sponsor and Shareholder of
21Shares XRP ETF
Opinion on the Financial Statements
We have audited the accompanying statements of assets and liabilities, including the schedules of investment, of 21Shares XRP ETF (the “Trust”) as of December 31, 2025, and December 31, 2024, the related statements of operations and changes in net assets for the year ended December 31, 2025, and for the period from December 20, 2024 (commencement of operations) through December 31, 2024, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2025, and 2024, and the results of its operations and changes in its net assets for the year ended December 31, 2025, and for the period from December 20, 2024 (commencement of operations) through December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Trust’s management. Our responsibility is to express an opinion on the Trust’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement whether due to error or fraud. The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Trust’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of cash and digital assets owned as of December 31, 2025, and 2024, by correspondence with the custodians. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
We have served as the Trust’s auditor since 2024.
/s/ Cohen & Company, Ltd.
COHEN & COMPANY, LTD.
Towson, Maryland
March 30, 2026
F- 2
21SHARES XRP ETF
STATEMENTS OF ASSETS AND LIABILITIES
December 31,
2025
December 31,
2024
Assets
Investment in XRP, at fair value (cost $ 289,712,269 and $ 220,676,000 , respectively) $ 247,693,539 $ 209,510,000
Total assets 247,693,539 209,510,000
Liabilities
Sponsor Fee payable 35,268 157,810
Total liabilities 35,268 157,810
Commitments and contingent liabilities (Note 9)
Net assets $ 247,658,271 $ 209,352,190
Net assets consists of
Paid-in-capital $ 295,007,000 $ 220,676,000
Accumulated earnings (loss) ( 47,348,729 ) ( 11,323,810 )
$ 247,658,271 $ 209,352,190
Shares issued and outstanding, no par value, unlimited amount authorized 13,890,000 10,000,000
Net asset value per share $ 17.83 $ 20.94
The accompanying notes are an integral part
of the financial statements.
F- 3
21SHARES XRP ETF
SCHEDULES OF INVESTMENT
December 31, 2025
Quantity of
XRP
Cost
Fair Value
%
of Net
Assets
Investment in XRP 135,559,073.5077 $ 289,712,269 $ 247,693,539 100.01 %
Total investments $ 289,712,269 $ 247,693,539 100.01 %
Liabilities in excess of other assets ( 35,268 ) ( 0.01 )%
Net assets $ 247,658,271 100.00 %
December 31, 2024
Quantity of
XRP
Cost
Fair Value
% of
Net
Assets
Investment in XRP 100,000,000.0000 $ 220,676,000 $ 209,510,000 100.08 %
Total investments $ 220,676,000 $ 209,510,000 100.08 %
Liabilities in excess of other assets ( 157,810 ) ( 0.08 )%
Net assets $ 209,352,190 100.00 %
The accompanying notes are an integral part
of the financial statements.
F- 4
21SHARES XRP ETF
STATEMENTS OF OPERATIONS
For the Year
Ended
December 31, 2025
For the
Period from
December 20,
2024
(commencement
of operations)
through
December 31,
2024
Expenses
Sponsor Fee $ 5,938,467 $ 163,196
Total expenses 5,938,467 163,196
Net investment loss $ ( 5,938,467 ) $ ( 163,196 )
Realized and change in unrealized gain (loss)
Net realized gain on investment in XRP sold to pay Sponsor Fee 765,081 -
Net change in unrealized appreciation on Sponsor Fee payable 1,197 5,386
Net change in unrealized depreciation on investment in XRP ( 30,852,730 ) ( 11,166,000 )
Net realized and change in unrealized loss ( 30,086,452 ) ( 11,160,614 )
Net decrease in net assets resulting from operations $ ( 36,024,919 ) $ ( 11,323,810 )
The accompanying notes are an integral part
of the financial statements.
F- 5
21SHARES XRP ETF
STATEMENTS OF CHANGES IN NET ASSETS
For the Year
Ended
December 31, 2025
For the
Period from
December 20,
2024
(commencement
of operations) through
December 31,
2024
Net assets, beginning of period $ 209,352,190 $ –
Contributions for Shares issued 74,331,000 220,676,000
Net investment loss ( 5,938,467 ) ( 163,196 )
Net realized gain on investment in XRP sold to pay Sponsor Fee 765,081 –
Net change in unrealized appreciation on Sponsor Fee payable 1,197 5,386
Net change in unrealized depreciation on investment in XRP ( 30,852,730 ) ( 11,166,000 )
Net assets, end of period $ 247,658,271 $ 209,352,190
Shares issued and redeemed
Shares issued 3,890,000 10,000,000
Shares redeemed – –
Net increase in Shares issued and outstanding 3,890,000 10,000,000
The accompanying notes are an integral part
of the financial statements.
F- 6
21Shares
XRP ETF
Notes
to Financial Statements
1. Organization
The 21Shares XRP ETF (the “Trust”) is a Delaware statutory trust, formed on June 3, 2024, pursuant to the Delaware Statutory Trust Act (“DSTA”). On December 16, 2024, the Trust changed its name from 21Shares Core XRP Trust to 21Shares XRP Trust. On August 22, 2025, the Trust changed its name from 21Shares XRP Trust to 21Shares XRP ETF. The Trust is an exchange-traded fund that issues units of beneficial interest (the “Shares”) representing fractional undivided beneficial interests in its net assets that trade on the Cboe BZX Exchange, Inc. (the “Exchange”). The Trust is a passive investment vehicle that does not seek to generate returns beyond tracking the price of XRP tokens (“XRP”). The Shares were listed for trading on the Exchange on December 11, 2025, under the ticker symbol “TOXR”. The transfer agent (the “Transfer Agent”), the administrator for the Trust (the “Administrator”), and the cash custodian (the “Cash Custodian”), is Bank of New York Mellon. Prior to the Shares being listed on the Exchange, NAV Consulting, Inc. was the administrator of the Trust.
The issuance and sale of the Shares by the Trust and the compliance by 21Shares US LLC. 21Shares US LLC is a limited liability company organized and existing under the laws of Delaware and the sponsor of the Trust (the “Sponsor”). In November 2025, 21co Holdings Limited, Jura Pentium Inc’s former ultimate parent company, was acquired by FalconX Holdings Limited, which became the ultimate parent company of Jura Pentium Inc. CSC Delaware Trust Company, serves as the trustee of the Trust (the “Trustee”). The Purchaser has full power, legal capacity and authority to enter into and perform the Purchaser’s obligations, and no approvals or consent of any governmental or regulatory authority or other persons is necessary in connection herewith. Coinbase Custody Trust Company, LLC (“Coinbase Custodian”), and BitGo Bank & Trust Company, N.A. (“BitGo”), and Anchorage Digital Bank N.A (“Anchorage”, and, together with Coinbase Custodian and BitGo, as the context may require, the “XRP Custodians”, “Custodians”, and each an “XRP Custodian”) are the custodians for the Trust and hold all of the Trust’s XRP on the Trust’s behalf.
The Trust’s investment objective is to seek to track the performance of XRP, as measured by the performance of the CME CF XRP-Dollar Reference Rate—New York Variant (the “Pricing Benchmark”), adjusted for the Trust’s expenses and other liabilities. CF Benchmarks Ltd. is the administrator for the Pricing Benchmark (the “Pricing Benchmark Provider”). The Pricing Benchmark is designed to reflect the performance of XRP in U.S. dollars. In seeking to achieve its investment objective, the Trust holds XRP at its Custodian and values its Shares daily based on the Pricing Benchmark.
The Trust is an “emerging growth company” as that term is used in the Securities Act of 1933, as amended (the “Securities Act”), and, as such, the Trust may elect to comply with certain reduced public company reporting requirements.
Ripple Markets Inc., a corporation incorporated and existing under the laws of Delaware served as the “Seed Capital Investor” to the Trust. On December 20, 2024 (“commencement of operations”), the Ripple Markets Inc., in its capacity as Seed Capital Investor, subject to certain conditions, purchased 10,000,000 Shares at a per-Share price of $22.07 (the “Initial Seed Shares”). Total proceeds to the Trust from the sale of the Initial Seed Shares were $220,676,000. Delivery of the Initial Seed Shares was made on December 20, 2024.
The fiscal year end of the Trust is December 31 st .
2. Significant Accounting Policies
Basis of Accounting
The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”). The Trust qualifies as an investment company solely for accounting purposes and not for any other purpose and follows the accounting and reporting guidance under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services - Investment Companies, but is not registered, and is not required to be registered, as an investment company under the Investment Company Act of 1940, as amended. The Trust uses fair value as its method of accounting for XRP in accordance with its classification as an investment company for accounting purposes.
Accounting Estimates
The preparation of the financial statements in conformity with U.S. GAAP requires the Trust to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ materially from such estimates as additional information becomes available or actual amounts may become determinable. Should actual results differ from those previously recognized, the recorded estimates will be revised accordingly with the impact reflected in the operating results of the Trust in the reporting period in which they become known.
F- 7
Cash
Cash includes non-interest bearing, non-restricted cash maintained with one financial institution that does not exceed U.S. federally insured limits.
Investment Valuation
U.S. GAAP defines fair value as the price the Trust would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Trust’s policy is to value investments held at fair value.
The Trust identifies and determines the XRP principal market (or in the absence of a principal market, the most advantageous market) for GAAP purposes consistent with the application of the fair value measurement framework in FASB ASC 820 – Fair Value Measurement. A principal market is the market with the greatest volume and activity level for the asset or liability. The determination of the principal market will be based on the market with the greatest volume and level of activity that can be accessed. The Trust obtains relevant volume and level of activity information and based on initial analysis will select an exchange market as the Trust’s principal market. The net asset value (“NAV”) and NAV per Share will be calculated using the fair value of XRP based on the price provided by this exchange market, as of 4:00 p.m. ET on the measurement date for GAAP purposes. The Trust will update its principal market analysis periodically and as needed to the extent that events have occurred, or activities have changed in a manner that could change the Trust’s determination of the principal market.
Various inputs are used in determining the fair value of assets and liabilities. Inputs may be based on independent market data (“observable inputs”) or they may be internally developed (“unobservable inputs”). These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes. The level of a value determined for an asset or liability within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are as follows:
Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not considered to be active, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and
Level 3: Unobservable inputs, including the Trust’s assumptions used in determining the fair value of investments, where there is little or no market activity for the asset or liability at the measurement date.
The following table presents information about the Trust’s assets measured at fair value as of December 31, 2025 and 2024:
Amount at Fair Value Measurement Using
Fair Value Level 1 Level 2 Level 3
December 31, 2025
Assets
Investment in XRP $ 247,693,539 $ 247,693,539 $ – $ –
Amount at Fair Value Measurement Using
Fair Value Level 1 Level 2 Level 3
December 31, 2024
Assets
Investment in XRP $ 209,510,000 $ 209,510,000 $ – $ –
The cost basis of the investment in XRP recorded by the Trust for financial reporting purposes is the fair value of XRP at the time of purchase. The cost basis recorded by the Trust may differ from proceeds collected by the Authorized Participant from the sale of the corresponding Shares to investors.
Investment Transactions
The Trust considers investment transactions to be the receipt of XRP for Share creations and the delivery of XRP for Share redemptions or for payment of expenses in XRP. The Trust records its investments transactions on a trade date basis and changes in fair value are reflected as net change in unrealized appreciation or depreciation on investments. Realized gains and losses are calculated using the specific identification method. Realized gains and losses are recognized in connection with transactions including settling obligations for the Sponsor Fee in XRP.
F- 8
Calculation of NAV and NAV per Share
On each day other than when the Exchange is closed for regular trading (a “Business Day”), as soon as practicable after 4:00 p.m. (Eastern Time), the NAV of the Trust is obtained by subtracting all accrued fees, expenses and other liabilities of the Trust from the fair value of the XRP and other assets held by the Trust based on the Pricing Benchmark price. The Administrator computes the NAV per Share by dividing the NAV of the Trust by the number of Shares outstanding on the date the computation is made.
Federal Income Taxes
The Sponsor and the Trustee will treat the Trust as a “grantor trust” for U.S. federal income tax purposes. Although not free from doubt due to the lack of directly governing authority, if the Trust operates as expected, the Trust should be classified as a “grantor trust” for U.S. federal income tax purposes and the Trust itself should not be subject to U.S. federal income tax. Each beneficial owner of Shares will be treated as directly owning its pro rata Share of the Trust’s assets and will be treated as if it directly received a pro rata portion of the Trust’s income, gain, losses and deductions. If the Trust sells XRP (for example, to pay fees or expenses), such a sale is a taxable event to Shareholders. Upon a Shareholder’s sale of its Shares, the Shareholder will be treated as having sold the pro rata share of the XRP held in the Trust at the time of the sale and recognizes gain or loss on such sale.
The Sponsor has reviewed the tax positions as of December 31, 2025, and has determined that no provision for income tax is required in the Trust’s financial statements.
Segment Reporting
The Trust operates in one segment. The segment derives its revenues from Trust investments made in accordance with the defined investment strategy of the Trust, as prescribed in the Trust’s prospectus. The Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer of the Sponsor. The CODM monitors the operating results of the Trust. The financial information that the Sponsor leverages to assess the segment’s performance and to make decisions for the Trust’s single segment is consistent with the financial information that is presented within the Trust’s financial statements. Segment assets are reflected on the accompanying Statement of Assets and Liabilities as Total assets and the only significant segment expense, the Sponsor Fee, is included in the accompanying Statements of Operations.
3. Fair Value of XRP
The following represents the changes in quantity of XRP and the respective fair value for the year ended December 31, 2025:
Quantity
of XRP Fair Value
Beginning balance as of January 1, 2025 100,000,000.0000 $ 209,510,000
XRP purchased 37,964,073.5077 74,331,000
XRP sold ( 2,405,000.0000 ) ( 6,061,009 )
Net realized gain on investment in XRP sold to pay Sponsor Fee – 765,081
Net change in unrealized appreciation on Sponsor Fee payable – 1,197
Net change in unrealized depreciation on investment in XRP – ( 30,852,730 )
Ending balance as of December 31, 2025 135,559,073.5077 $ 247,693,539
The following represents the changes in quantity of XRP and the respective fair value for the period ended December 31, 2024:
Quantity
of XRP Fair Value
Beginning balance as of December 20, 2024 (commencement of operations) – $ –
XRP purchased 100,000,000.0000 220,676,000
Change in unrealized depreciation on investment in XRP – ( 11,166,000 )
Ending balance as of December 31, 2024 100,000,000.0000 $ 209,510,000
F- 9
4. Trust Expenses
The Trust pays the unitary Sponsor Fee of 0.30 % per annum of the Trust’s XRP holdings (the “Sponsor Fee”). Prior to December 11, 2025, the Sponsor Fee was 2.50 %. The Sponsor Fee is paid by the Trust to the Sponsor as compensation for services performed under the Trust Agreement. The Sponsor Fee accrues daily and is payable in XRP weekly in arrears. The Administrator calculates the Sponsor Fee on a daily basis by applying an annualized rate to the Trust’s total XRP holdings, and the amount of XRP payable in respect of each daily accrual is determined by reference to the Pricing Benchmark. The Sponsor has agreed to pay all operating expenses (except for litigation expenses and other extraordinary expenses) out of the Sponsor Fee. The Trust incurred Sponsor fees for the years ended December 31, 2025, and 2024 of $ 5,938,467 and $ 163,196 , respectively. The accrued liability at December 31, 2025, and 2024 was $ 35,268 and $ 157,810 respectively.
The Sponsor has agreed to pay all operating expenses (except for litigation expenses and other extraordinary expenses) out of the Sponsor Fee. Operating expenses assumed by the Sponsor include: (i) the fee payable to the marketing agent for services it provides to the Trust (the “Marketing Fee”), (ii) fees to the Administrator, if any, (iii) fees to the XRP Custodians, (iv) fees to the Transfer Agent, (v) fees to the Trustee, (vi) the fees and expenses related to any future listing, trading or quotation of the Shares on any listing exchange or quotation system (including legal, marketing and audit fees and expenses), (vii) ordinary course legal fees and expenses but not litigation-related expenses, (viii) audit fees, (ix) regulatory fees, including if applicable any fees relating to the registration of the Shares under the Securities Act or the Exchange Act, (x) printing and mailing costs; (xi) costs of maintaining the Sponsor’s website and (xii) applicable license fees (each, a “Sponsor-paid Expense” and together, the “Sponsor-paid Expenses”), provided that any expense that qualifies as an Additional Trust Expense (as defined below) will be deemed to be an Additional Trust Expense and not a Sponsor-paid Expense.
The Sponsor will not, however, assume certain extraordinary, non-recurring expenses that are not Sponsor-paid Expenses, including, but not limited to, taxes and governmental charges, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders, any indemnification of the XRP Custodians, Administrator or other agents, service providers or counterparties of the Trust, the fees and expenses related to the listing, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters (collectively, “Additional Trust Expenses”). Of the Sponsor-paid Expenses, ordinary course legal fees and expenses shall be subject to a cap of not in excess of $ 100,000 per annum. In the Sponsor’s sole discretion, all or any portion of a Sponsor-paid Expense may be re-designated as an Additional Trust Expense.
To the extent that the Sponsor does not voluntarily assume expenses, they will be the responsibility of the Trust. The Sponsor also pays the costs of the Trust’s organization and offering. The Trust is not obligated to repay any such costs related to the Trust’s organization and offering paid by the Sponsor.
5. Creation and Redemption of Shares
The Trust creates and redeems Shares on a continuous basis but only in one or more Baskets consisting of 10,000 Shares or multiples thereof on the NAV of the date of the creation or redemption. Only “Authorized Participants”, which are registered broker-dealers who have entered into written agreements with the Sponsor and the Administrator, can place orders.
For a period ending two (2) years (the “Lock-up Period”), Ripple Markets Inc., has agreed that it shall not, without the prior written consent of the Sponsor, sell, transfer, assign, pledge, hypothecate or otherwise dispose of any of the Initial Seed Shares it holds, nor will Ripple Markets Inc., seek to have the Trust or the Sponsor redeem the Initial Seed Shares during the Lock-up Period. Irrespective of whether such two (2) year lock up period has elapsed or not, once the Trust is first listed on a national securities exchange, the Initial Seed Shares shall remain locked-up for a further period of six (6) months from the date of listing. Following expiration of the Lock-up Period, the Ripple Markets Inc., may, to the extent permitted by applicable laws, be permitted to redeem Shares in accordance with the Trust Agreement.
Authorized Participants may purchase Shares in cash by depositing cash in the Trust’s account with the Cash Custodian. This will cause the Sponsor, on behalf of the Trust, to automatically instruct a designated third party, who may be an Authorized Participant or an affiliate of an Authorized Participant, and with whom the Sponsor has entered into an agreement on behalf of the Trust (each such third party, a “XRP Counterparty”), to (i) purchase the amount of XRP equivalent in value to the cash deposit amount associated with the order and (ii) deposit the resulting XRP amount in the Trust’s accounts with the XRP Custodians, resulting in the Transfer Agent crediting the applicable amount of Shares to the Authorized Participant. Authorized Participants may also purchase Shares in-kind. To purchase Shares in-kind, an Authorized Participant delivers or arranges for the delivery by the Authorized Participant’s designee of, XRP to the Trust’s accounts with an XRP Custodian in exchange for Shares.
When such an Authorized Participant redeems its Shares in cash, the Sponsor, on behalf of the Trust will direct an XRP Custodian to transfer XRP to an XRP Counterparty, who will sell the XRP to be executed, in the Sponsor’s reasonable efforts, at the Pricing Benchmark price used to calculate the Trust’s NAV, taking into account any spread, commissions, or other trading costs and deposit the cash proceeds of such sale in the Trust’s account with the Cash Custodian for settlement with the Authorized Participant. Any slippage incurred (including, but not limited to, any trading fees, spreads, or commissions), on a cash equivalent basis, will be the responsibility of the Authorized Participant and not of the Trust or Sponsor. Authorized Participants may also redeem Shares in-kind. When such an Authorized Participant redeems Shares in-kind, the Trust, through an XRP Custodian, will deliver XRP to the Authorized Participant, or its designee in exchange for Shares.
Year Ended
December 31,
2025 For the
Period from
December 20,
2024 (commencement of operations) through December 31,
2024
Activity in Capital Shares:
Shares issued 3,890,000 10,000,000
Shares redeemed - -
Net Change in Capital Shares 3,890,000 10,000,000
F- 10
Year Ended
December 31, 2025 For the
Period from
December 20, 2024 (commencement of operations)
through December 31, 2024
Activity in Capital Transactions:
Contributions for shares issued $ 74,331,000 $ 220,676,000
Distributions for shares redeemed - -
Net Change in Capital Transactions $ 74,331,000 $ 220,676,000
XRP purchased payable represents the quantity of XRP purchased for the creation of Shares where the XRP has not yet settled. Generally, XRP is transferred within two Business Days of the trade date.
December 31, 2025 December 31, 2024
XRP purchased payable $ - $ -
XRP sold receivable represents the quantity of XRP sold for the redemption of Shares where the XRP has not yet been settled. Generally, XRP is transferred within two Business Days of the trade date.
December 31, 2025 December 31, 2024
XRP sold receivable
$ - $ -
6. Related Parties
The Sponsor is a related party to the Trust. The Trust’s operations are supported by its Sponsor, who is in turn supported by its parent company and affiliated companies and external service providers.
As of December 31, 2024, and December 31, 2025, the Sponsor owned 0 and 20,000 Shares of the Trust, respectively.
The Sponsor arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their public offering in the United States and the listing of Shares on the Exchange.
7. Quarterly Statement of Operations
For the year ended December 31, 2025
Three Months
Ended
(unaudited) Year Ended
Mar-31,
2025 Jun-30,
2025 Sept-30,
2025 Dec-31,
2025 December 31,
2025
Expenses
Sponsor Fee $ 1,558,678 $ 1,366,006 $ 1,829,200 $ 1,184,583 $ 5,938,467
Net expenses 1,558,678 1,366,006 1,829,200 1,184,583 5,938,467
Net investment loss ( 1,558,678 ) ( 1,366,006 ) ( 1,829,200 ) ( 1,184,583 ) ( 5,938,467 )
Realized and change in unrealized gain (loss)
Net realized gain on investment in XRP sold to pay Sponsor Fee 131,491 11,825 533,848 87,917 765,081
Net change in unrealized appreciation (depreciation) on Sponsor Fee payable 84,129 ( 34,003 ) ( 97,267 ) 48,338 1,197
Net change in unrealized appreciation (depreciation) on investment in XRP 1,375,222 17,188,651 56,103,429 ( 105,520,032 ) ( 30,852,730 )
Net realized and change in unrealized gain (loss) 1,590,842 17,166,473 56,540,010 ( 105,383,777 ) ( 30,086,452 )
Net increase (decrease) in net assets resulting from operations $ 32,164 $ 15,800,467 $ 54,710,810 $ ( 106,568,360 ) $ ( 36,024,919 )
F- 11
8. Financial Highlights
Per Share Performance (for a Share outstanding throughout the period presented)
For the
Year Ended
December 31,
2025 For the
Period from
December 20, 2024 (commencement of operations) through
December 31,
2024
Net asset value per Share, beginning of period $ 20.94 $ 22.07 1
Net investment loss on investment in XRP 2 ( 0.58 ) ( 0.02 )
Net realized and change in unrealized gain (loss) on investment in XRP 3 ( 2.53 ) ( 1.11 )
Net change in net assets resulting from operations ( 3.11 ) ( 1.13 )
Net asset value per Share, end of period $ 17.83 $ 20.94
Total return, at net asset value 4 , 6 ( 14.85 )% ( 5.12 )%
Ratio to average net assets 5
Net investment income (loss) ( 2.38 )% ( 2.28 )% 7
Gross expenses 2.38 % 2.28 % 7
Net expenses 2.38 % 2.28 % 7
1 Represents the NAV per Share on December 20, 2024, commencement of operations.
2 Calculated using average Shares outstanding.
3 The amount shown for a Share outstanding throughout the period may not agree with the change in the aggregate gains and losses for the period because of the timing of sales and repurchases of the Trust’s Shares in relation to fluctuating market values for the Trust.
4 Total return is calculated based on the change in value during the period and is not annualized. An individual shareholder’s total return and ratio may vary from the above total returns and ratios based on the timing of contributions to and withdrawals from the Trust.
5 Annualized.
6 Not annualized.
7 Calculated based on average net assets starting on December 20, 2024, commencement of operations.
9. Commitments and Contingent Liabilities
In the normal course of business, the Trust may enter into contracts that contain a variety of general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust which have not yet occurred and cannot be predicted with any certainty. However, the Sponsor believes the risk of loss under these arrangements to be remote.
10. Concentration Risk
Unlike other funds that may invest in diversified assets, the Trust’s investment strategy is concentrated in a single asset within a single asset class. This concentration maximizes the degree of the Trust’s exposure to a variety of market risks associated with XRP and digital assets. By concentrating its investment strategy solely in XRP, any losses suffered as a result of a decrease in the value of XRP can be expected to reduce the value of an interest in the Trust and will not be offset by other gains if the Trust were to invest in underlying assets that were diversified.
F- 12
11. Indemnification
The Sponsor will not be liable to the Trust, the Trustee or any Shareholder for any action taken or for refraining from taking any action in good faith, or for errors in judgment or for depreciation or loss incurred by reason of the sale of any XRP or other assets of the Trust. However, the preceding liability exclusion will not protect the Sponsor against any liability resulting from its own gross negligence, bad faith, or willful misconduct.
The Sponsor and each of its shareholders, members, directors, officers, employees, affiliates, and subsidiaries will be indemnified by the Trust and held harmless against any losses, liabilities or expenses incurred in the performance of its duties under the Trust Agreement without gross negligence, bad faith, or willful misconduct. The Sponsor may rely in good faith on any paper, order, notice, list, affidavit, receipt, evaluation, opinion, endorsement, assignment, draft, or any other document of any kind prima facie properly executed and submitted to it by the Trustee, the Trustee’s counsel or by any other person for any matters arising under the Trust Agreement. The Sponsor shall in no event be deemed to have assumed or incurred any liability, duty, or obligation to any Shareholder or to the Trustee other than as expressly provided for in the Trust Agreement. Such indemnity includes payment from the Trust of the costs and expenses incurred in defending against any indemnified claim or liability under the Trust Agreement.
The Trustee will not be liable or accountable to the Trust or any other person or under any agreement to which the Trust or any series of the Trust is a party, except for the Trustee’s breach of its obligations pursuant to the Trust Agreement or its own willful misconduct, bad faith or gross negligence. The Trustee and each of the Trustee’s officers, affiliates, directors, employees, and agents will be indemnified by the Trust from and against any losses, claims, taxes, damages, reasonable expenses, and liabilities incurred with respect to the creation, operation or termination of the Trust, the execution, delivery or performance of the Trust Agreement or the transactions contemplated thereby; provided that the indemnified party acted without willful misconduct, bad faith or gross negligence.
12. Subsequent Events
The Trust has evaluated all subsequent events and transactions for potential recognition or disclosure through the issuance of the financial statements and has noted no events requiring adjustment or additional disclosure in the financial statements.
F- 13