The XRP ETF goes into effect without approval: what the SEC's silence really means

The XRP community is quite satisfied following the revelations about the recent listing of the Teucrium XRP ETF, which technically came into effect without the direct approval of the U.S. Securities and Exchange Commission (SEC). Analysts, journalists, and legal pros are weighing in, and the story once again highlights how murky regulation for cryptocurrency ETFs remains.

It all started when analyst Chad pointed out that the Teucrium XRP ETF was not explicitly approved by the SEC. Instead, the agency allowed the legal deadline to pass without making a decision, which means the fund came into effect automatically. “Silence is complicity,” he wrote on X, sparking a new debate on Crypto Twitter.

Journalist Eleanor Terrett later clarified what many were wondering: does this mean that spot cryptocurrency ETFs, including XRP, could also slip through the cracks? Her answer: not exactly.

The Teucrium XRP ETF holds Treasury bonds, cash, and receivables from swaps, and is registered under the Investment Company Act of 1940. This structure means that the SEC does not have to actively approve it, only allow the statutory period to pass. Futures ETFs often operate similarly.

But spot ETFs are different. These fall under the Securities Act of 1933 as commodity trusts. That means they require direct and explicit approval from the SEC before they can be listed. So a future spot ETF for XRP, LTC, or SOL will not be possible without an active green light from the regulators.

Complications due to the government shutdown

Pro-XRP attorney Bill Morgan added another complication. He pointed out that although ETF approvals could be delayed by the current shutdown of the U.S. government, not all SEC operations depend on Congressional funding. The Division of Corporate Finance, which handles ETF applications, could proceed with decisions if the shutdown does not last too long.

Morgan summarized it by saying that ETF approvals by the end of October are not necessarily “off the table” – but with cryptocurrencies, surprises are always possible.

I find it ironic that while the SEC aggressively pursues Ripple, it allows this XRP-related ETF to come into effect through the back door. This regulatory ambiguity is killing us investors who only want clarity. When will they stop playing these political games with our money?

For XRP holders, the big question is whether this quiet step could pave the way for more direct approvals in the future, or if it is just another reminder that the path to widespread ETF adoption remains tangled in regulatory bureaucracy.