Swiss crypto asset manager 21Shares, formerly known as Amun, has removed XRP from its exchange-traded products (ETPs).
The affected products are 21Shares' flagship "HODL" or Crypto Basket Index ETP and "KEYS" or Bitwise Select 10 ETP. The firm is also monitoring its AXRP product — a single-asset ETP tied to XRP — but no decision has been taken yet.
The move comes as the U.S. Securities and Exchange Commission (SEC) has filed a case against Ripple and its executives Brad Garlinghouse and Chris Larsen. The regulator deems XRP as a security and says the executives have raised billions of dollars through unregistered securities sales of XRP.
But none of the 21Shares' ETPs are listed on U.S. exchanges, then why remove XRP? CEO Hany Rashwan told The Block that the company's index rules prohibit including "any token that is a security and any token that might have liquidity issues."
"The risk on both sides is high, especially with a number of large over-the-counter (OTC) trading desks exiting the XRP market, specifically Jump Trading and Galaxy Digital," said Rashwan.
Since the SEC lawsuit, several exchanges have halted the trading of XRP, including Bitstamp, OSL, CrossTower, and Beaxy. Crypto asset manager Bitwise also liquidated the XRP position of its crypto index fund last week.
Meanwhile, 21Shares manages $250 million worth of assets across its products.
Update: After the publication of this story, 21Shares said it is still monitoring AXRP and has not removed the product yet.