Company: TOXR
Filing Date: 2025-11-20
Form Type: S-1/A
Source: 0001213900-25-112826
Chunk: 83

Company: 21Shares XRP ETF
Filing Date: 2025-11-20
Form: S-1/A
Chunk 83
---
, sometimes significantly. This volatility has in the past apparently impacted the
price of XRP. Stablecoins are a relatively new phenomenon and it is impossible to know all of the risks that they could pose to
participants in the XRP market. In addition, some have argued that some stablecoins, particularly Tether, are improperly issued without
sufficient backing in a way that could cause artificial rather than genuine demand for XRP, raising its price, and also argue that those
associated with certain stablecoins that are involved in laundering money. On February 17, 2021, the New York Attorney General
entered into an agreement with Tether’s operators, requiring them to cease any further trading activity with New York persons
and pay $18.5 million in penalties for false and misleading statements made regarding the assets backing Tether. On October 15,
2021, the CFTC announced a settlement with Tether’s operators in which they agreed to pay $42.5 million in fines to settle
charges that, among others, Tether’s claims that it maintained sufficient U.S. dollar reserves to back every Tether stablecoin
in circulation with the “equivalent amount of corresponding fiat currency” held by Tether were untrue.

Stablecoins are reliant
on the U.S. banking system and U.S. treasuries, and the failure of either to function normally could impede the function of
stablecoins and therefore could adversely affect the value of the Shares.

Given the role that stablecoins
play in global digital asset markets, their fundamental liquidity can have a dramatic impact on the broader digital asset market, including
the market for XRP. Volatility in stablecoins, operational issues with stablecoins (for example, technical issues that prevent settlement),
concerns about the sufficiency of any reserves that support stablecoins, or regulatory concerns about stablecoin issuers or intermediaries,
such as exchanges, that support stablecoins, could impact individuals’ willingness to trade on trading venues that rely on stablecoins
and could impact the price of XRP, and in turn, an investment in the Shares.

<div align='center'>36</div>

Validators may cease participating in validating activities because they are provided no direct financial incentive to participate or because certain jurisdictions may limit or otherwise regulate validating activities, which could negatively impact the price of XRP and the value of the Shares.

Unlike many other blockchain
networks, validators on the XRP Ledger are not directly compensated for their participation in the consensus process. Running a