21Shares XRP ETF Annual Report: A Simple Guide

I’ve put together this guide to help you understand how the 21Shares XRP ETF performed this year. My goal is to explain the financial details in plain English so you can decide if this fund fits your investment strategy.

1. What does this fund do?

Think of this ETF as a digital vault for XRP. Instead of buying and storing XRP yourself, this fund does the heavy lifting for you. It holds actual XRP, and its share price tracks the value of the coin. Because it is a "passive" fund, there are no managers making bets; it simply holds the asset. Your shares represent a direct stake in the XRP held in secure, offline storage.

2. Performance and costs

Since the fund launched on December 17, 2025, we have partial-year data. The fund charges a flat annual fee of 0.30%. This covers all operating costs, including the 0.15% fee paid to Coinbase Custody, as well as audit, legal, and marketing expenses. You won’t receive a separate bill. The fee is taken out daily, which slightly reduces the amount of XRP held per share over time.

3. Wins and challenges

The biggest win was launching on the Cboe BZX Exchange, which gives you institutional-grade access to XRP. The fund has seen an average daily trading volume of $12 million, which helps keep the price stable when you place an order.

4. Safety and security

The fund is a simple entity with no employees or offices. To keep your investment safe, Coinbase Custody holds the XRP in "cold storage." This means the coins are kept offline in secure, geographically spread-out vaults. Your assets are held in separate accounts, so they are protected if 21Shares or the custodian faces financial trouble.

5. Key risks

• Price Swings: XRP is very volatile. It is common for the price to move 20% in just 48 hours, which directly changes your share value.
• Trading Gaps: As a new product, the share price might occasionally drift away from the actual price of XRP if trading volume is low.
• Taxes: Because the fund is a trust, the IRS treats you as if you own the XRP directly. Selling shares may trigger capital gains taxes. Also, the fund’s periodic sale of XRP to pay its 0.30% fee is a taxable event for you.
• Competition: The crypto ETF market is crowded. Other funds from companies like Grayscale or Bitwise may offer different fees or track records that attract more investors.

6. Strategy and outlook

The strategy is simple: track the price of XRP. The fund does not use borrowed money; it maintains a 1:1 ratio of XRP to shares. The team aims to keep the share price within 0.50% of the actual XRP price. The fund has no end date and will continue operating as long as it remains profitable.

7. Important note

You have no voting rights. 21Shares makes all administrative decisions. Also, this fund is not regulated like a traditional mutual fund. It lacks certain protections, such as an independent board of directors.

Final Thought for Investors: This ETF is designed for those who want exposure to XRP without the technical hurdles of managing a digital wallet. Because of the volatility inherent in crypto and the specific tax treatment of this trust, it is best to review your personal financial goals and tax situation before adding this to your portfolio.