Company: TOXR
Filing Date: 2025-10-10
Form Type: S-1/A
Source: 0001213900-25-098141
Chunk: 90

Company: 21Shares XRP ETF
Filing Date: 2025-10-10
Form: S-1/A
Chunk 90
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, which the Trust would not be able to use in connection with in-kind creations and redemptions. Such delays could cause the execution
price associated with such trades to materially deviate from the Pricing Benchmark price used to determine the NAV. Even though
the Authorized Participant is responsible for the dollar cost of such difference in prices, Authorized Participants could default on
their obligations to the Trust, or such potential risks and costs could lead to Authorized Participants, who would otherwise be willing
to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares
and the price of the underlying XRP, to elect to not participate in the Trust’s Share creation and redemption processes. This may
adversely affect the arbitrage mechanism intended to keep the price of the Shares closely linked to the price of XRP, and as a result,
the price of the Shares may fall or otherwise diverge from NAV. If the arbitrage mechanism is not effective, purchases or sales
of Shares on the secondary market could occur at a premium or discount to NAV, which could harm Shareholders by causing them buy Shares
at a price higher than the value of the underlying XRP held by the Trust or sell Shares at a price lower than the value of the underlying
XRP held by the Trust, causing Shareholders to suffer losses.

To the knowledge of the
Sponsor, exchange-traded products for spot-market commodities other than XRP, such as gold and silver, generally employ in-kind creations
and redemptions with the underlying asset. The Sponsor believes that it is generally more efficient, and therefore less costly, for spot
commodity exchange-traded products to utilize in-kind orders rather than cash orders, because there are fewer steps in the process and
therefore there is less operational risk involved when an authorized participant can manage the buying and selling of the underlying
asset itself, rather than depend on an unaffiliated party such as the issuer or sponsor of the exchange-traded product. As such, a spot
commodity exchange-traded product that only employs cash creations and redemptions and does not permit in-kind creations and redemptions
is a novel product that has not been tested, and could be impacted by any resulting operational inefficiencies.

If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of XRP may not exist and, as a result