Vermont-based asset manager Teucrium Investment Advisors LLC is making history this Tuesday, April 8, 2025, with the launch of the first XRP-based exchange-traded fund (ETF) in the United States. The Teucrium 2x Long Daily XRP ETF (XXRP) will begin trading on NYSE Arca, offering investors leveraged exposure to one of the world’s most prominent cryptocurrencies.
A Unique Market Entry
What makes this launch particularly noteworthy is that XXRP will be a leveraged product, designed to deliver twice the daily performance of XRP, rather than a standard “spot” ETF that directly tracks the underlying asset. Bloomberg Senior ETF Analyst Eric Balchunas highlighted this unusual sequence, noting it’s “very odd (maybe a first) that a new asset’s first ETF is leveraged” before the approval of a standard spot ETF.
Typically, new asset classes in the ETF market begin with straightforward spot products before more complex leveraged options are introduced. This reverse order for XRP represents an unconventional approach to cryptocurrency ETF launches.
How the Fund Works
According to Teucrium’s website, the 2x Long Daily XRP ETF aims to provide investment results corresponding to twice the daily price performance of XRP. For example, if XRP’s price increases by 10% in a single day, the ETF should theoretically rise by approximately 20%, before accounting for fees and expenses.
The fund will not directly hold XRP tokens but will instead use swaps to mirror the performance of the cryptocurrency. Teucrium will charge a management fee of 1.85%, and the ETF will offer monthly distributions to investors.
It’s important to note that the ETF’s returns reset daily, making it primarily suitable for short-term trading rather than long-term holding. As with other leveraged products, compounding effects can significantly impact returns over extended periods.
Risks and Considerations
Teucrium has been transparent about the potential challenges facing the fund. The company’s prospectus specifically warns about XRP’s price volatility and declining usage on the Ripple network as factors that could affect the ETF’s performance.
The leveraged nature of the product introduces additional complexity and risk. Due to daily reset mechanisms and the effects of compounding, even if XRP remains flat after a year of trading, the fund could still experience substantial losses if volatility is high. According to Teucrium’s prospectus, ETF losses could reach 63.2% if annualized volatility hits 100%.
This means that even during periods when XRP trends upward over the long term, the ETF’s returns could be eroded depending on day-to-day volatility.
Market Context and Timing
Teucrium’s founder and CEO Sal Gilbertie told Bloomberg that the launch timing during a market downturn driven by President Donald Trump’s tariffs is actually advantageous, saying, “What better time to launch a product than when prices are low?”
As of Monday evening, April 7, XRP was trading at approximately $1.91, showing a modest 0.64% increase over the previous 24 hours. By Tuesday morning, the price had moved to around $1.87, representing a more substantial 5.46% gain as part of a broader crypto market recovery.
The Road to Spot XRP ETFs
While Teucrium breaks new ground with its leveraged offering, multiple asset managers have filed applications with the U.S. Securities and Exchange Commission (SEC) for spot XRP ETFs. These include industry heavyweights such as Grayscale, WisdomTree, Bitwise, 21Shares, Canary Capital, and Franklin Templeton.
The SEC has acknowledged several of these applications, suggesting the review process is moving forward. Bloomberg analysts currently assign a 65% probability to spot XRP ETF approval in 2025, while predictions market Polymarket puts the chances even higher at 75%.
A significant hurdle to XRP ETFs was recently cleared when Ripple Labs, the company behind XRP, settled its long-running legal battle with the SEC last month. The four-year dispute over whether XRP should be classified as a security concluded with Ripple agreeing to pay a $50 million fine, reduced from the $125 million initially imposed in August.
Market Implications and Investor Demand
The introduction of an XRP ETF marks another milestone in the ongoing institutionalization of cryptocurrency markets. Following the successful launches of Bitcoin ETFs and more recently Ethereum ETFs, XRP represents the next major digital asset to gain ETF accessibility for U.S. investors.
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However, analyst Min Jung of Presto Research notes that demand for spot XRP ETFs remains uncertain: “Ethereum ETFs have seen limited traction, and institutions still largely believe ‘there is no second best,'” referring to Bitcoin’s dominant position in institutional portfolios.
The leveraged structure of Teucrium’s offering suggests it’s targeting sophisticated investors and traders rather than mainstream retail or institutional adoption. The firm describes its target audience as those with “a short-term high-conviction view on XRP prices.“
About Teucrium
Teucrium Investment Advisors has accumulated over $310 million in assets under management since its founding in 2010. The firm has primarily focused on agricultural commodities, offering ETFs that track markets such as corn, soybeans, sugar, and wheat. The XRP ETF represents a significant expansion into the cryptocurrency space for the Vermont-based asset manager.
Looking Ahead
As XXRP begins trading on Tuesday, the cryptocurrency industry will be watching closely to gauge investor interest and performance. The launch could serve as a bellwether for potential spot XRP ETF approvals later this year.
The SEC’s approach to XRP ETFs may also provide insights into the regulatory path forward for other altcoin ETFs, with analysts suggesting that if any new spot cryptocurrency ETFs are approved after Bitcoin and Ethereum, XRP and Solana are the strongest contenders.
For investors interested in exposure to XRP through traditional brokerage accounts, the Teucrium 2x Long Daily XRP ETF offers a first-of-its-kind opportunity, though one that comes with the significant complexities and risks inherent to leveraged products tracking volatile cryptocurrency markets.
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