Company: TOXR
Filing Date: 2025-11-07
Form Type: S-1/A
Source: 0001213900-25-107665
Chunk: 247

Company: 21Shares XRP ETF
Filing Date: 2025-11-07
Form: S-1/A
Chunk 247
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 purposes
consistent with the application of the fair value measurement framework in FASB ASC 820 – Fair Value Measurement. A principal
market is the market with the greatest volume and activity level for the asset or liability. The determination of the principal
market will be based on the market with the greatest volume and level of activity that can be accessed. The Trust obtains relevant
volume and level of activity information and based on initial analysis will select an exchange market as the Trust’s principal
market. The net asset value (“NAV”) and NAV per Share will be calculated using the fair value of XRP based on the price
provided by this exchange market, as of 4:00 p.m. ET on the measurement date for GAAP purposes. The Trust will update its principal
market analysis periodically and as needed to the extent that events have occurred, or activities have changed in a manner that
could change the Trust’s determination of the principal market.

Various inputs are used in determining
the fair value of assets and liabilities. Inputs may be based on independent market data (“observable inputs”) or they may
be internally developed (“unobservable inputs”). These inputs are categorized into a disclosure hierarchy consisting of three
broad levels for financial reporting purposes. The level of a value determined for an asset or liability within the fair value hierarchy
is based on the lowest level of any input that is significant to the fair value measurement in its entirety. The three levels of the
fair value hierarchy are as follows:

Level 1 - Unadjusted quoted prices
in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted
prices included within Level 1 that are observable for the asset or liability either directly or indirectly, including quoted prices
for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are
not considered to be active, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived
principally from or corroborated by observable market data by correlation or other means; and

Level 3 – Unobservable inputs,
including the Trust’s assumptions used in determining the fair value of investments, where there is little or no market activity
for the asset or liability at the measurement date.

To the extent that digital assets
are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy.

Investment Transactions

The Trust considers investment
transactions to be the receipt of XRP for Share creations and the