XRPZ: The XRP ETF Boom Still Has A Long Way To Go

Summary The Franklin XRP ETF is rated Hold, reflecting early-stage adoption and a relatively small footprint versus XRP’s $94B market cap. XRPZ’s 0. 19% fee is competitive post-waiver, but persistent inflows and limited redemptions, especially during XRP drawdowns, are key signals to monitor.

Secondary-market liquidity and Ripple’s escrow-driven supply remain crucial risks, alongside the ETF’s $1. 82 historical acquisition cost versus current XRP prices. I’m awaiting the next quarterly filing to assess sustained ETF flows, creations, and redemptions as indicators of institutional adoption durability.

The U. S. spot XRP ETF market launched roughly a year ago.

And it has seen tremendous growth. SoSoValue data shows the category has attracted around $1. 69 billion in net assets and about $1.

79 billion in cumulative inflows. SoSoValue I still think we are quite early here. Those ETF assets are still relatively small when you compare them to XRP’s market cap.

And I find this interesting since the exchange-traded funds continued to witness demand even when the underlying token underperforms. XRP had its market cap at approximately $94 billion on October 2, with the token trading at around $1. 50.

That puts the entire U. S. spot XRP ETF sector at only about 1.

8% of the underlying market. The funds display an attractive performance with relatively steady flows. And the observation that the ETF wrapper still represents a small portion of XRP is the center of my Franklin XRP ETF (XRPZ) analysis today.

I’m rating this fund a Hold at current valuations. Reasons? I think its 0.

19% fee, meaningful inflows, and continued exposure to the expanding ETF market give XRPZ an interesting setup. What I want to see is whether that demand can persist through different XRP price conditions. We are just a year since these products launched.

So I expect the category to keep developing. But how durable that adoption becomes matters more to me. I’ll also highlight the lingering risks, particularly crypto volatility and secondary-market liquidity.

You might have guessed that right. Now let’s dive deeper! XRP ETF Adoption is Still Early Again, this is a relatively new ETF category.

So I’m going to use simple penetration numbers to illustrate the potential growth in this sector. Taking the current XRP market cap of roughly $94 billion as a reference, a 3% ETF penetration would represent about $2. 8 billion in assets.

That figure grows to $4. 7 billion at 5%. And at 10%, it would be $9.

4 billion. These aren’t solid forecasts. I’m just trying to show the gap between today’s XRP ETF net assets (of around $1.

69 billion) and a more mature ETF market. XRPZ has already attracted substantial demand since launching. It had accumulated approximately $505 million in net inflows and roughly $443 million in net assets as of October 1.

SoSoValue The Franklin XRP fund also has a competitive expense ratio. Its current 0. 19% is below 21Shares’ 0.

30%, 0. 34% for Bitwise, and Grayscale’s 0. 35%.

Canary (0. 50%) and REX-Osprey (0. 75%) are also way higher.

But I don’t think fees would answer our question. We have Bitwise, which has accumulated more assets (over $680 million) despite its higher fee (than XRPZ). What interests me more is whether investors continue creating XRPZ shares when XRP is struggling price-wise.

We might find a better answer in the latest 10-Q. What Happened When XRP Fell Over 20% Franklin’s second-quarter 10-Q shows XRPZ held 225. 37 million XRP as of June 30.

Those assets were valued at approximately $236. 48 million. And the aggregate historical cost was $410.

97 million, or roughly $1. 82 per XRP. SEC Filing Again, the $1.

82 figure is the fund’s aggregate historical acquisition cost. Don’t mistake it for the cost basis for every XRPZ shareholder. Another fascinating thing is in the flow data.

XRPZ issued 6. 05 million shares for 65. 71 million XRP during the second quarter.

Q2 saw zero redemptions. The fund’s NAV declined by 22. 15% at the same time, with XRP down 22.

10%. That’s a tiny difference. Though it tells us something about XRPZ’s tracking.

Franklin says the sponsor fee caused the NAV to dip slightly more than XRP. I think what happened to the shares matters more. XRPZ continued to create shares while the underlying token was losing over 20% of its value.

These creations can involve things like arbitrage, trading strategies, and different forms of positioning. So they don’t necessarily mean every new share represented a long-term investor purchasing XRP exposure. Still, I consider zero redemptions during the quarter a more vital signal.

To me, that has more weight than simply pointing at $500 million of total inflows and calling that institutional demand. XRPZ’s fee is Now Different Franklin joined the XRP ETF industry with a fee waiver for the first $5 billion of assets through May 31, 2026. The fund accrued $118,464 in sponsor fees and received $79,901 in waivers and reimbursements during the quarter.

That left $38,563 in net expenses. The fee waiver ended. And XRPZ now has to compete on its real 0.

19%. I actually think the fee comparison is more useful today. XRPZ’s current fee is relatively low compared to peers.

The thing is investors looking at the fund now are no longer evaluating XRPZ using the same launch-period economics. Don’t Forget the Risks XRP is obviously the top one here. XRPZ gives you exposure to XRP.

So it’s highly sensitive to the altcoin’s actions. If XRP dips, the ETF should generally decline with it, minus expenses. The ETF structure doesn’t safeguard shareholders from significant downsides.

Also, remember the $1. 82 historical cost. XRP is trading at around $1.

50 today, which leaves the fund’s aggregate historical acquisition cost materially higher than the current market price. I’m still constructive on crypto as I watch my first Bitcoin target of $88,250. So I think XRP might recover toward $1.

82 in the coming sessions. I’ll be monitoring redemptions if such a climb occurs. Investors might switch to profit-taking if XRP reclaims the ETF’s aggregate acquisition cost.

Though we don’t know the cost basis of individual XRPZ shareholders. So I wouldn’t add that to my thesis today. I’ll watch out for more details in the next filing.

Now something that we can’t leave out when talking about these products. And that’s liquidity. XRPZ traded around 1.

83 million shares on October 1, with $29. 38 million in value traded. Bitwise’s XRP ETF, the largest in this category, traded over 1.

3 million and $52. 63 million in value on that day. That gap is crucial when dealing with large orders.

That’s because secondary-market liquidity can impact execution even when XRP itself trades in a much deeper market. XRPZ's $29. 38 million value traded on October 1 was significant.

But it also shows why I don’t want to treat ETF assets and secondary-market liquidity as the same thing. Supply is another risk. Ripple’s escrow allows the release of up to 1 billion XRP each month.

Well, that doesn’t mean selling a billion tokens per month. The actual amount entering circulation can be significantly lower since unused tokens return to escrow. The potential supply still matters.

Remember, the ETF demand has to compete with the amount of XRP assets available in the market. Pay attention to regulatory developments. Ripple’s legal fight with the SEC ended in August 2025.

Attention had been on the CLARITY Act lately, which failed to advance in the Senate in mid-September. For XRP, clearer crypto regulations might bolster institutional participation and the overall investment-product market. The Next Filing Matters All I want now is the third-quarter filing.

That’s the next key checkpoint for me. Franklin filed its Q2 10-Q on August 14. So the September-quarter filing should arrive around mid-November.

That’s if the fund follows the exact timetable. That filing will tell us what happened during Q3. I’ll pay attention to the number of XRPZ shares purchased.

Whether redemptions eventually appeared. How much XRP did the fund hold as of September 30? And whether its asset growth continued alongside the broader ETF category.

XRP ETF flows remain steady. My concern is that flows can stay positive while net assets dip if XRP’s price falls. And again, positive flows don’t necessarily mean the ETF sector is responsible for XRP’s price trajectory.

I think persistence matters more here. What I want is investors to keep adding XRP exposure through the ETF wrapper during both strong and weak periods. That’s when I’ll consider this category more like a developing institutional allocation channel and less like a launch-driven trade.

Investment Takeaway I rate the Franklin XRP ETF a Hold today. That’s not because the XRP exchange-traded funds have maintained steady inflows since launching. What attracted my attention is that the category remains relatively small compared to XRP’s market capitalization.

And XRPZ has already logged over $500 million in cumulative inflows and $443 million in net assets. The initial fee waiver ended. The fund now has its regular 0.

19% fee. I’m keeping an eye on XRP itself for now. Plus secondary-market liquidity and the $1.

82 historical cost level. I’ll reassess the adoption narrative if XRP moves through different price conditions. And the next filing gives us more data on creations and redemptions.

What I want now is continued creations, limited redemptions, and sustained ETF flows even when XRP is weak. To me, such a pattern would strengthen the case that the U. S.

XRP market is maturing into a more durable allocation channel.