Company: TOXR
Filing Date: 2025-08-22
Form Type: S-1/A
Source: 0001213900-25-079981
Chunk: 80

Company: 21Shares XRP ETF
Filing Date: 2025-08-22
Form: S-1/A
Chunk 80
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In the past, flaws in the source
code for digital asset networks have been exposed and exploited, including flaws that disabled some functionality for users, exposed users’
personal information and/or resulted in the theft of users’ digital assets. Several errors and defects have been publicly found
and corrected, including those that disabled some functionality for users and exposed users’ personal information. Discovery of
flaws in or exploitations of the source code that allow malicious actors to take or create money in contravention of known network rules
have occurred. The cryptography underlying XRP could prove to be flawed or ineffective, or negatively impacted by developments in mathematics
and/or technology, such as advances in digital computing, algebraic geometry and quantum computing. In any of these circumstances, a malicious
actor may be able to steal XRP held by others, which could adversely affect the demand for XRP and therefore adversely impact the price
of XRP and the value of the Shares. Even if another digital asset other than XRP were affected by similar circumstances, any reduction
in confidence in the robustness of the source code or cryptography underlying digital assets generally could negatively affect the demand
for all digital assets, including XRP, and therefore adversely affect the value of the Shares.

Mathematical or technological advances could undermine the XRP Ledger’s consensus mechanism.

The XRP Ledger is premised
on multiple persons competing to solve cryptographic puzzles quickly. It is possible that mathematical or technological advances, such
as the development of quantum computers with significantly more power than computers presently available, could undermine or vitiate the
cryptographic consensus mechanism underpinning the XRP Ledger.

The XRP Ledger faces scaling challenges and efforts to increase the volume of transactions may not be successful.

Many digital asset networks
face significant scaling challenges due to the fact that public blockchains generally face a tradeoff between security and scalability.
One means through which public blockchains such as the XRP Ledger achieve security is decentralization, meaning that no intermediary is
responsible for securing and maintaining these systems. For example, a greater degree of decentralization generally means a given digital
asset network is less susceptible to manipulation or capture.

As the use of digital asset
networks increases without a corresponding increase in transaction processing speed of the networks, average fees and settlement times
can increase significantly. Increased fees and decreased settlement speeds could preclude use cases for XRP and could reduce demand for
and the price of XRP, which could adversely impact the value of