Grayscale Investments is closing its Grayscale XRP Trust and liquidating its XRP holdings to distribute cash proceeds to the trust’s shareholders. The company cited difficulties converting XRP to US dollars after the US Securities and Exchange Commission filed a lawsuit against Ripple.
Grayscale axes XRP Trust
Grayscale Investments announced on Wednesday that the “Dissolution of the Grayscale XRP Trust” will begin.
The company announced that the US Securities and Exchange Commission decided on December 22nd to “file a lawsuit in federal court against certain third parties alleging that XRP is a” security “within the meaning of the federal securities act.” It added:
In response to the SEC’s actions, some major market players have announced actions, including the removal of XRP from major digital asset trading platforms.
This has led Grayscale to the conclusion that it is likely to become increasingly difficult for US investors, including US investors [Grayscale XRP] Trust to convert XRP to US dollars and keep the trust going. “
Grayscale went on to state that it has “liquidated the trust’s XRP and intends to distribute the net cash proceeds to the trust’s shareholders after costs have been deducted and adequate reserves have been made and subject to withholding taxes, if any.”
The company emphasized:
The trust ends after the net proceeds have been distributed.
After removing the XRP trust, Grayscale now offers nine crypto investment products: the Bitcoin Trust, the Bitcoin Cash Trust, the Ethereum Trust, the Ethereum Classic Trust, the Horizen Trust, the Litecoin Trust, the Stern-Lumen-Trust, the Zcash-Trust and the digital large-cap-fund. As of January 13, the total assets under management of its crypto products were $ 24.7 billion.
Do you think Grayscale did the right thing to shut down its XRP product? Let us know in the comments below.
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