Company: TOXR
Filing Date: 2025-08-22
Form Type: S-1/A
Source: 0001213900-25-079981
Chunk: 83

Company: 21Shares XRP ETF
Filing Date: 2025-08-22
Form: S-1/A
Chunk 83
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.S. treasuries, and the failure of either to function normally could impede the function of
stablecoins, and therefore could adversely affect the value of the Shares.

Given the role that stablecoins
play in global digital asset markets, their fundamental liquidity can have a dramatic impact on the broader digital asset market, including
the market for XRP. Volatility in stablecoins, operational issues with stablecoins (for example, technical issues that prevent settlement),
concerns about the sufficiency of any reserves that support stablecoins, or regulatory concerns about stablecoin issuers or intermediaries,
such as exchanges, that support stablecoins, could impact individuals’ willingness to trade on trading venues that rely on stablecoins
and could impact the price of XRP, and in turn, an investment in the Shares.

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Validators may cease participating in validating activities because they are provided no direct financial incentive to participate or because certain jurisdictions may limit or otherwise regulate validating activities, which could negatively impact the price of XRP and the value of the Shares.

Unlike many other blockchain
networks, validators on the XRP Ledger are not directly compensated for their participation in the consensus process. Running a validator
on the XRP Ledger is generally considered a voluntary contribution to the health and decentralization of the network. Participants run
validators for reasons other than direct financial gain, such as supporting the network’s decentralization, ensuring its security,
or for reputational benefits within the XRP community. However, because there is no financial incentive for entities or individuals to
maintain validators, there is no guarantee that such entities or individuals will continue to do so. Additionally, entities or individuals
running validators in certain jurisdictions may be limited or prohibited from continuing these activities as a result of regulation or
governmental decree.

Validators ceasing operations
or participation in the consensus mechanism would make the XRP Ledger more vulnerable to malicious actors obtaining sufficient control
to alter the blockchain and hinder transactions. Any reduction in confidence in the confirmation process and security of the XRP Ledger
may adversely affect the Trust’s investments in XRP. To the extent that a significant number of entities or individuals stop
running validators, there would be serious negative consequences to the XRP Ledger’s functionality, security and overall existence.

Electricity usage.

Concerns have been raised about
the electricity required to secure and maintain digital asset networks. Although measuring the electricity consumed by the process of
securing and maintaining digital asset networks is difficult because these operations are performed by