Company: TOXR
Filing Date: 2025-11-07
Form Type: S-1/A
Source: 0001213900-25-107665
Chunk: 135

Company: 21Shares XRP ETF
Filing Date: 2025-11-07
Form: S-1/A
Chunk 135
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. When sending
XRP, a user’s XRP Ledger software program must validate the transaction with the associated private key. In addition, since every
computation on the XRP Ledger requires processing power, there is a transaction fee involved with the transfer that is paid by the payor.
The resulting digitally validated transaction is sent by the user’s XRP Ledger software program to the XRP Ledger validators to
allow transaction confirmation.

Some XRP transactions are
conducted “off-blockchain” (i.e., through centralized book-entries) and are therefore not recorded on the XRP Ledger. These
“off-blockchain transactions” involve the transfer of control over, or ownership of, a specific digital wallet holding XRP
or the reallocation of ownership of certain XRP in a pooled-ownership digital wallet, such as a digital wallet owned by a digital asset
trading platforms. In contrast to on-blockchain transactions, which are publicly recorded on the XRP Ledger, information and data regarding
off-blockchain transactions are generally not publicly available. Therefore, off-blockchain transactions are not truly XRP Ledger transactions
in that they do not involve the transfer of transaction data on the XRP Ledger and do not reflect a movement of XRP between addresses
recorded in the XRP Ledger. For these reasons, off-blockchain transactions are subject to risks as any such transfer of XRP ownership
is not protected by the protocol behind the XRP Ledger or recorded in, and validated through, the ledger mechanism.

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XRP can also be held in escrow
on the XRP Ledger, meaning the XRP is locked up and released only when certain conditions are met (e.g., at a specific time or when a
particular event occurs). This is a native feature of the ledger, providing flexibility for complex financial contracts. XRP can also
be held in payment channels, which allow for off-ledger transactions to occur between two parties, with the final balance being settled
on the ledger later. Each XRP Ledger account must also hold a minimum reserve of XRP (currently 10 XRP) which cannot be spent. This ensures
that only legitimate accounts are created and maintained. The XRP Ledger supports multi-signature accounts, where multiple keys can be
required to authorize transactions. This adds an extra layer of security for holding and transferring large amounts of XRP.

Summary of an XRP Transaction

The following is a summary
of a payment transaction of X