Company: TOXR
Filing Date: 2025-11-20
Form Type: S-1/A
Source: 0001213900-25-112826
Chunk: 94

Company: 21Shares XRP ETF
Filing Date: 2025-11-20
Form: S-1/A
Chunk 94
---
 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, the price of the Shares may fall or otherwise diverge from NAV.

If the processes of creation
and redemption of Shares (which depend on timely transfers of XRP to and by the XRP Custodians) encounter any unanticipated difficulties
due to, for example, the price volatility of XRP, the insolvency, business failure or interruption, default, failure to perform, security
breach, or other problems affecting the XRP Custodians, any operational issues that may arise from creating and redeeming Shares via
cash transactions, the closing of XRP trading platforms due to fraud, failures, security breaches or otherwise, or network outages or
congestion, spikes in transaction fees demanded by validators, or other problems or disruptions affecting the XRP network, then potential
market participants, such as the Authorized Participants and their customers, 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 may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. In certain
such cases, the Sponsor may suspend the process of creation and redemption of Baskets. During such times, trading spreads, and the resulting
premium or discount, on Shares may widen. Alternatively, in the case of a network outage or other problems affecting the XRP network,
the processing of transactions on the XRP Ledger may be disrupted, which in turn could affect the creation or redemption of Baskets.
If this is the case, the liquidity of the Shares may decline and the price of the Shares may fluctuate independently of the price of
XRP and may fall or otherwise diverge from NAV. Furthermore, in the event that the market for XRP should become relatively illiquid
and thereby materially restrict opportunities for arbitraging by delivering XRP in return for Baskets, the price of Shares may diverge
from the value of