Company: TOXR
Filing Date: 2025-12-08
Form Type: S-1/A
Source: 0001213900-25-118924
Chunk: 91

Company: 21Shares XRP ETF
Filing Date: 2025-12-08
Form: S-1/A
Chunk 91
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 result in lower prices for the Shares.
Decreases in XRP prices may also occur as a result of selling activity by other market participants.

In addition to the effect
that purchases and sales of as part of the creation and redemption process may have on the price of XRP, sales and purchases of XRP by
similar investment vehicles (if developed) could impact the price of XRP. If the price of XRP declines, the trading price of the
Shares will generally also decline.

The inability of XRP Counterparties to hedge their XRP exposure may adversely affect the liquidity of Shares and the value of an investment in the Shares.

Authorized Participants and
market makers will generally want to hedge their exposure in connection with Basket creation and redemption orders. To the extent Authorized
Participants and market makers are unable to hedge their exposure due to market conditions (e.g., insufficient XRP liquidity in the market,
inability to locate an appropriate hedge counterparty, etc.), such conditions may make it difficult for Authorized Participants to create
or redeem Baskets (or cause them to not create or redeem Baskets). In addition, the hedging mechanisms employed by XRP Counterparties
to hedge their exposure to XRP may not function as intended, which may make it more difficult for them to enter into such transactions.
Such events could negatively impact the market price of Shares and the spread at which Shares trade on the open market. The liquidity
of the market will depend on, among other things, the adoption of XRP and the commercial and speculative interest in the market.

Arbitrage transactions intended to keep the price of Shares closely linked to the price of XRP may be problematic if the process for the creation and redemption of Baskets encounters difficulties, which may adversely affect an investment in the Shares.

If the processes of creation
and redemption of the Shares encounter any unanticipated difficulties, potential market participants who would otherwise be willing to
purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares
and the price of the underlying XRP may not take the risk that, as a result of those difficulties, they may not be able to realize the
profit they expect. If this is the case, the liquidity of Shares may decline and the price of the Shares may fluctuate independently
of the price of XRP and may fall.

The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, may adversely affect the arbitrage transactions by Authorized Participants intended