Grayscale Investments To Commence Dissolution of Grayscale XRP Trust
- Grayscale Investments announcement a result of SEC’s action.
- Consequent delisting of XRP may prevent ease in converting XRP to the dollar.
- Dissolution will precede the distribution of net proceeds to stakeholders.
Grayscale Investments, a financial advisory firm, has announced its decision to dissolve its XRP Trust. The step followed the Securities and Exchange Commission’s (SEC) charges against Ripple. According to the SEC, XRP remains unregistered security. It’s two top executives have been accused of raising nearly $1.3 billion via an ongoing and illegal securities offering.
The market response also led to Grayscale Investments decision.
Following the SEC’s decision on December 22, 2020, the leading digital asset manager removed XRP from its fund for large-cap cryptocurrencies. There have been significant market responses to the federal lawsuit raised by the SEC. Major delisting’s have also occurred on various digital asset trading platforms. Beaxy and OSL were first to make these decisions as other top blockchain players distance themselves from XRP.
These occurrences have served to force the hand of Grayscale Investments, which functions as a sponsor. The recent developments would make it increasingly difficult for United States investors and the Trust to make XRP conversions to cash.
Dissolution will precede distribution of cash proceeds, says Grayscale Investments
Grayscale Investments has begun the liquidation of its Grayscale XRP Trust. The dissolution process will precede the distribution of the net cash, which will be valued in dollars. These would then be shared amongst Trust stakeholders. The deduction of expenses and provision of reserves would also take place at the same time.
Following the liquidation and distribution processes, the Grayscale Trust will be terminated. Currently, Grayscale Investments leads the digital currency asset management world with assets valued at $20 billion under management. Genesis Global Trading distributes Grayscale products.