Company: TOXR
Filing Date: 2025-12-10
Form Type: 424B3
Source: 0001213900-25-120172
Chunk: 72

Company: 21Shares XRP ETF
Filing Date: 2025-12-10
Form: 424B3
Chunk 72
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 and therefore investors in XRP-related investment products such as the Trust, are exposed to an elevated risk of fraud and loss, including, but not limited to, through cyber-attacks. XRP can be stolen, and XRP stored in a digital wallet, accessible via private key, can be compromised. While digital wallets do not store or contain the actual XRP, they store public and private keys, which are used as an address for receiving XRP or for spending the XRP, with both forms of transactions recorded on the public immutable ledger, the blockchain. By using the private key, a person is able to spend XRP, effectively sending it away from the account and recording that transaction on the blockchain. If a private key is compromised, XRP associated with that specific public key may be stolen. Unlike traditional banking transactions, once a transaction has been added to the blockchain, it cannot be reversed. Several exchanges specializing in sales of XRP, for example, have already had their operations impacted by cyber-attacks.

Thefts and cyber-attacks can have a negative impact on the reputation, market price, value, or liquidity of XRP. Through investment in the Trust, investors would be indirectly exposed to the risk and potential impact of a cyber-attack. A loss associated with a cyber-attack, including a total loss, is possible. While the Sponsor and the XRP Custodians have taken reasonable measures to prevent theft or hacking of the Trust’s XRP holdings, such an event cannot be fully excluded from the Trust’s overall market exposure, and the losses associated with such an event would be borne by investors.

Digital asset networks, including
the XRP Ledger, are subject to control by entities that capture a significant amount of the network’s active validator nodes or
a significant number of developers important for the operation and maintenance of such digital asset network. The XRP Ledger relies on
a network of validator nodes that agree on the order and validity of transactions. These nodes form the backbone of the consensus process.
Each validator node maintains a Unique Node List, which is a list of other validators it trusts. For a malicious actor to take over,
they would need to control a significant portion of the validators on the majority of these UNLs. To successfully alter the ledger, the
malicious actor would likely need to control more than 80% of the validator nodes or the voting power on the most widely used UNLs.

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A malicious actor may also obtain control over the XRP