Company: TOXR
Filing Date: 2025-12-08
Form Type: S-1/A
Source: 0001213900-25-118924
Chunk: 249

Company: 21Shares XRP ETF
Filing Date: 2025-12-08
Form: S-1/A
Chunk 249
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The Trust considers investment transactions
to be the receipt of XRP for Share creations and the delivery of XRP for Share redemptions or for payment of expenses in XRP. The Trust
records its investments transactions on a trade date basis and changes in fair value are reflected as net change in unrealized appreciation
or depreciation on investments. Realized gains and losses are calculated using the specific identification method. Realized gains and
losses are recognized in connection with transactions including settling obligations for the Sponsor’s Fee in XRP.

<div align='center'>F-9</div>

21Shares XRP ETF

Notes to the financial statements

(Expressed in United States Dollars)

| 2. | Significant Accounting Policies (CONTINUED) |

Calculation of Net Asset Value “NAV” and NAV per Share

On each day other than when the
exchange is closed for regular trading (a “Business Day”), as soon as practicable after 4:00 p.m. (Eastern Time), the net
asset value of the Trust is obtained by subtracting all accrued fees, expenses and other liabilities of the Trust from the fair value
of the XRP and other assets held by the Trust using the index price. The Trustee computes the NAV per Share by dividing the NAV of the
Trust by the number of Shares outstanding on the date the computation is made.

Federal Income Taxes

The Sponsor and the Trustee will
treat the Trust as a “grantor trust” for US federal income tax purposes. Although not free from doubt due to the lack of
directly governing authority, if the Trust operates as expected, the Trust should be classified as a “grantor trust” for
US federal income tax purposes and the Trust itself should not be subject to US federal income tax. Each beneficial owner of Shares will
be treated as directly owning its pro rata Share of the Trust’s assets and a pro rata portion of the Trust’s income, gain,
losses and deductions will “pass through” to each beneficial owner of Shares. If the Trust sells XRP (for example, to pay
fees or expenses), such a sale is a taxable event to Shareholders. Upon a Shareholder’s sale of its Shares, the Shareholder will
be treated as having sold the pro rata share of the XRP held in the Trust at the time of the sale and may recognize gain or loss on such
sale. The Sponsor has reviewed the tax positions as of August 31, 2025, and