Company: TOXR
Filing Date: 2025-11-07
Form Type: S-1/A
Source: 0001213900-25-107665
Chunk: 138

Company: 21Shares XRP ETF
Filing Date: 2025-11-07
Form: S-1/A
Chunk 138
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 investor on the XRP Ledger unless the investor makes a request to the exchange to withdraw
the XRP in its platform trading account to an off-platform XRP wallet.

Outside of the spot markets,
XRP can be traded over-the-counter (“OTC”). The OTC market is largely institutional in nature, and OTC market participants
generally consist of institutional entities, such as firms that offer two-sided liquidity for XRP, investment managers, proprietary trading
firms, high-net-worth individuals that trade XRP on a proprietary basis, entities with sizeable XRP holdings, and family offices. The
OTC market provides a relatively flexible market in terms of quotes, price, quantity, and other factors, although it tends to involve
large blocks of XRP. The OTC market has no formal structure and no open-outcry meeting place. Parties engaging in OTC transactions
will agree upon a price — often via phone or email — and then one of the two parties will then initiate
the transaction. For example, a seller of XRP could initiate the transaction by sending the XRP to the buyer’s XRP address. The
buyer would then wire U.S. dollars to the seller’s bank account. OTC trades are sometimes hedged and eventually settled with
concomitant trades on digital asset trading platforms.

As discussed in more detail
below, barring the liquidation of the Trust or extraordinary circumstances, the Trust will not directly purchase or sell XRP, although
the Sponsor may direct the XRP Custodians to sell XRP to pay certain expenses. Instead, Authorized Participants will deliver XRP to the
Trust’s accounts with the XRP Custodians in exchange for Shares of the Trust, and the Trust, through the XRP Custodians, will deliver
XRP to Authorized Participants when those Authorized Participants redeem Shares.

Limits on XRP Supply

Unlike other digital assets
such as bitcoin or ether, XRP was not mined gradually over time. Instead, all 100 billion XRP tokens were created at the time of
the XRP Ledger’s launch in 2012. This means that every XRP token that exists today was generated from the outset, without the need
for a mining process. Of the 100 billion XRP generated by the XRP Ledger’s code, the founders of Ripple Labs retained 20 billion
XRP and the rest, nearly 80 billion XRP, was provided to Ripple Labs.

In 2017, to address concerns
about the large