Why WisdomTree withdrew its XRP ETF filing despite strong inflows

WisdomTree scraps its XRP ETF plan just as spot XRP funds rack up $1.25b inflows and consolidate around a few aggressive first movers.

Summary

• WisdomTree pulled its XRP ETF S‑1, asking the SEC to withdraw all related exhibits after deciding not to proceed now.​
• Competing XRP ETFs from Grayscale, Franklin, Canary and Bitwise are absorbing over $1.25b in net inflows and building liquidity.​
• XRP trades below its 2025 peak as ETF demand climbs, mirroring post‑launch patterns seen in Bitcoin and Ethereum spot products.

WisdomTree Digital Commodity Services, the sponsor of the proposed WisdomTree XRP Fund, has formally asked the US Securities and Exchange Commission to withdraw its registration statement on Form S‑1.

In an RW notice dated 6 January, the trust wrote that, “pursuant to Rule 477 of Regulation C under the Securities Act of 1933, as amended (the ‘Securities Act’), WisdomTree XRP Fund hereby requests that the Securities and Exchange Commission consent to the withdrawal of the Trust’s Registration Statement on Form S‑1.”​

The firm added that “it has determined not to proceed at this time,” and asked the SEC to withdraw all related exhibits and amendments tied to its original December 2024 filing. No shares were sold under the registration, meaning the product never reached the market despite months of engagement with regulators and exchange partners.​

Competitive XRP ETF landscape

The abandoned product was designed to give investors regulated exposure to Ripple’s native token via shares listed on Cboe BZX, mirroring the structure used by WisdomTree’s earlier Bitcoin ETF. Instead, the issuer now exits a field where Grayscale, Canary, Franklin Templeton and Bitwise are already fighting for flows and liquidity in a narrow but aggressively contested niche. In recent months, the SEC repeatedly pushed back decisions on XRP (XRP) filings, forcing would‑be sponsors to navigate shifting timelines and rising legal and operational costs.​

Analysts describe XRP ETFs as a “third path” beyond Bitcoin and Ethereum: a way for asset managers to differentiate without straying into thinly traded long‑tail tokens. That differentiation comes with risk; issuers must invest heavily in distribution and spreads to stand out in a sector that, while growing, still sits far behind the liquidity profile of BTC and ETH vehicles.​

Inflows defy the retreat

WisdomTree’s withdrawal contrasts sharply with the cash torrent hitting live XRP products. Spot XRP ETFs in the US have amassed more than $1.25 billion in cumulative net inflows within weeks of launch, pushing total net assets to roughly $1.62 billion, according to SoSoValue data cited by multiple venues. On 6 January alone, XRP spot ETFs recorded $19.12 million in net inflows, extending a streak with no material outflow days.​

Franklin’s XRPZ led that latest session with $7.35 million of fresh capital, followed by $6.49 million into Canary’s XRPC and $3.54 million into Bitwise’s XRP fund. Earlier reports show weekly inflows above $40 million, even as short‑term price action remains choppy and traders fade rallies in the underlying token.​

XRP’s broader market backdrop

Despite the ETF bid, XRP still trades well below its 2025 peak, echoing patterns seen in Bitcoin and Ethereum after their own spot ETF debuts. Quant traders expect XRP’s trajectory to “broadly resemble” those earlier cycles, with phases of intense inflows followed by consolidation as speculative excess washes out. At the same time, XRP’s pitch as a payments and treasury asset keeps institutional interest alive, especially among investors seeking diversification from BTC‑ and ETH‑heavy portfolios.​

That tension—booming ETF demand versus cautious price action—frames WisdomTree’s decision in a harsher light. In a market where capital is clearly flowing but market share is concentrating around a handful of first movers, walking away “for now” may be less about XRP’s prospects and more about an issuer deciding it is late to a game that has already found its leaders.