Company: TOXR
Filing Date: 2025-11-07
Form Type: S-1/A
Source: 0001213900-25-107665
Chunk: 228

Company: 21Shares XRP ETF
Filing Date: 2025-11-07
Form: S-1/A
Chunk 228
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.S. federal income tax purposes 
 regardless of its source; or                                                           |

| ● | a trust,                                                                             
 if a court within the United States is able to exercise primary supervision over the 
 administration of the trust and one or more United States persons have the authority 
 to control all substantial decisions of the trust.                                   |

If a partnership or other
entity or arrangement treated as a partnership for U.S. federal income tax purposes holds Shares, the tax treatment of a partner
generally depends upon the status of the partner and the activities of the partnership. If you are a partner of a partnership holding
Shares, the discussion below may not be applicable and we urge you to consult your own tax adviser for the U.S. federal income tax
implications of the purchase, ownership and disposition of such Shares.

Taxation of the Trust

The Sponsor and the Trustee
will treat the Trust as a “grantor trust” for U.S. federal income tax purposes.

As a grantor trust, the Trust can undertake only certain types of activities. For example, generally, the Trust cannot vary its investment portfolio to take advantage of market fluctuations. The Trust may receive income from investment activities that do not require such decision-making. If staking is treated for U.S. federal income tax purposes as a passive ministerial and administrative activity, it should be permissible for the Trust. In the opinion of Dechert LLP, although not free from doubt due to the lack of directly governing authority, the Trust should be classified as a “grantor trust” for U.S. federal income tax purposes (and the following discussion assumes such classification). In the opinion of Dechert LLP, although not free from doubt due to the lack of directly governing authority, the Trust should be classified as a “grantor trust” for U.S. federal income tax purposes (and the following discussion assumes such classification). The Trust intends to operate so that it will qualify to be treated for U.S. federal income tax purposes as a grantor trust. Because the treatment of staking in a grantor trust is still developing, there remains a risk of adverse regulatory or legal determinations that could affect the tax treatment of the Trust as a grantor trust or affect the Trust’s operations. The opinion of Dechert LLP is based on various assumptions and representations relating to the Trust’s organization, operation, assets, activities, and income, including that all such assumptions representations on which the opinion is based and all other factual information set forth in the relevant documents, records, and