10-Q: 21Shares XRP ETF Reports Significant NAV Decline in Q2 2026

The 21Shares XRP ETF experienced a substantial drop in Net Asset Value (NAV) and XRP's market price during the second quarter of 2026, alongside a reduction in its sponsor fee.

Summary

• The 21Shares XRP ETF reported a significant decrease in its Net Asset Value (NAV) and the value of its XRP holdings for the quarter ended June 30, 2026.
• The Trust's NAV fell by 20.56% to $112,916,689 from $142,148,631, primarily driven by a 22.37% decline in XRP's price.
• For the six-month period ending June 30, 2026, the Trust's NAV decreased by 54.41% to $112,916,689 from $247,658,271, reflecting a 42.91% drop in XRP's price.
• The sponsor fee was reduced to 0.30% of NAV, down from 2.50% prior to December 11, 2025, with the sponsor covering most operating expenses.
• The Trust is transitioning its pricing benchmark from CME CF XRP-Dollar Reference RateNew York Variant to FTSE index data, effective August 31, 2026.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative score due to the significant decrease in XRP's value and the Trust's Net Asset Value (NAV) during the reporting period, despite a reduced sponsor fee.

Positives

• The sponsor fee was significantly reduced to 0.30% of the Trust's NAV, a decrease from the previous 2.50% rate.
• The sponsor continues to cover most operating expenses, including administrator, custodian, and transfer agent fees, out of the reduced sponsor fee.
• The Trust is transitioning to a new pricing benchmark provider (FTSE) which is not expected to materially impact NAV or operations.

Negatives

• The Trust's Net Asset Value (NAV) decreased by 20.56% to $112,916,689 during the three months ended June 30, 2026.
• The value of the Trust's investment in XRP decreased by 22.37% during the three months ended June 30, 2026.
• For the six months ended June 30, 2026, the Trust's NAV decreased by 54.41% to $112,916,689.
• The value of the Trust's investment in XRP decreased by 42.91% during the six months ended June 30, 2026.
• Net assets from operations for the six months ended June 30, 2026, showed a decrease of $85,241,051.

Risks

• The Trust's investment strategy is concentrated solely in XRP, maximizing exposure to market risks associated with XRP and digital assets.
• Any decrease in the value of XRP is expected to reduce the value of an interest in the Trust and will not be offset by gains from diversified assets.
• Forward-looking statements are subject to risks and uncertainties, including changes in laws or regulations, and actual results may differ materially.

Future Outlook

The Trust intends to transition its pricing benchmark from CME CF XRP-Dollar Reference RateNew York Variant to FTSE index data on or about August 24, 2026, with the change becoming effective around August 31, 2026. This transition is not expected to materially impact the Trust's NAV, fair value measurement of XRP, or results of operations.

Management Comments

• The Sponsor provided notice to the Pricing Benchmark Provider of the termination, effective August 31, 2026, of the licensing agreement.
• The Sponsor intends to enter into a licensing agreement with FTSE on or about August 24, 2026, for index data.
• The change in pricing benchmark provider is not expected to have a material impact on the Trust's net asset value, the fair value measurement of the Trust's XRP, or the Trust's results of operations.
• The Trust is an emerging growth company and may elect to comply with certain reduced public company reporting requirements.

Industry Context

StockSavvy.ai notes that the significant decline in the Trust's NAV and XRP's value reflects the broader volatility experienced in the digital asset market during the reporting period. The transition to a new benchmark provider is a common strategy for such funds to ensure continued operation and data integrity.

Comparison to Industry Standards

• The 21Shares XRP ETF's performance is directly tied to XRP, making direct comparison to diversified crypto ETFs or traditional financial products challenging.
• The reduction in sponsor fee to 0.30% aligns with a trend towards lower fees in the ETF market, particularly for digital asset-focused products, as competition increases.
• The concentration risk in a single digital asset (XRP) is a characteristic of many single-asset crypto ETPs, differentiating them from more diversified crypto funds or traditional ETFs.

Legal Proceedings

• As of June 30, 2026, the Trust was not subject to any material legal proceedings.
• No material legal proceedings are known to be threatened against the Trust.

Related Party Transactions

• The Sponsor, 21Shares US LLC, is a related party to the Trust.
• As of December 31, 2025, the Sponsor owned 20,000 Shares of the Trust; as of June 30, 2026, the Sponsor owned zero Shares.

Stakeholder Impact

• Shareholders have experienced a significant decrease in the value of their investment due to the decline in XRP's price and the Trust's NAV.
• The reduced sponsor fee benefits shareholders by lowering the cost of holding the ETF.
• The transition to a new benchmark provider is intended to ensure continued tracking of XRP performance for shareholders.

Next Steps

• The Trust will transition its pricing benchmark from CME CF XRP-Dollar Reference RateNew York Variant to FTSE index data.
• The licensing agreement with FTSE is expected to be entered into on or about August 24, 2026.
• The new benchmark is expected to become effective around August 31, 2026.

Key Dates

Recommendation

The significant decline in NAV and XRP price presents a negative outlook, but the reduced sponsor fee and the strategic shift to a new benchmark provider offer potential stabilization. Given the inherent volatility of digital assets and the recent performance, a 'hold' recommendation is prudent, awaiting further market recovery and the impact of the benchmark transition.

Keywords

XRP ETF, Digital Asset Fund, Cryptocurrency ETF, 21Shares, TOXR, Quarterly Report, NAV, XRP Price