Grayscale has introduced two significant operational upgrades to its Grayscale XRP Trust ETF (GXRP), which is listed on NYSE Arca. Analyst Xaif drew attention to the firm’s recent prospectus supplement filed on October 5, which outlines changes designed to enhance the product’s appeal to institutional investors and strengthen operational resilience.
Anchorage Digital added as second custodian
Grayscale named Anchorage Digital Bank as a new custodian for GXRP, joining Coinbase Custody Trust Company, LLC. Anchorage Digital Bank, a national trust bank regulated by the Office of the Comptroller of the Currency (OCC), now shares responsibility for safeguarding a portion of the trust’s XRP assets.
The move introduces a dual-custody framework, reducing concentration risk and reinforcing the ETF’s security model. By involving two institutional-grade custodians, Grayscale aims to provide additional security and assurance for investors, while meeting the rising institutional interest in XRP.
Mini dictionary: Anchorage Digital is a federally chartered digital asset platform that provides secure crypto custody and settlement solutions, recognized for its compliance-focused operations tailored to institutional clients.
In-kind creations and redemptions open new access
The other major upgrade enables in-kind creations and redemptions for GXRP. This development allows authorized participants such as market makers and hedge funds to move real XRP into and out of the ETF directly, rather than dealing solely in cash. This mechanism typically provides more favorable tax treatment and lowers market impact compared to cash-based transactions.
Virtu Americas LLC has already been named as an authorized participant able to conduct in-kind transactions, and Grayscale retains flexibility to approve additional participants in the future. These enhancements align GXRP’s core operations with industry standards found in spot Bitcoin and Ethereum ETFs.
Large institutional participants often favor in-kind systems for improved tax efficiency and minimized market impact, as they can directly use actual XRP to create or redeem shares of the ETF rather than converting cash to crypto or vice versa.
By adopting in-kind creations and redemptions, the trust forges a more direct connection between institutional capital flows and underlying XRP demand. When new ETF shares are created in-kind, participants must acquire and deliver actual XRP, tying ETF growth more closely to genuine on-chain asset accumulation.
| Feature | Before Upgrade | After Upgrade |
|---|---|---|
| Custodians | Coinbase Custody only | Coinbase Custody + Anchorage Digital |
| Creation/Redemption Method | Cash only | In-kind and cash options |
| Authorized Participants | Limited, cash-based only | Expanding, in-kind capability |
Path toward institutional readiness
GXRP first began trading on NYSE Arca in November 2025. The recent operational improvements move the product closer to the operational structure established for spot BTC and ETH ETFs, which experienced substantial institutional inflows following such developments.
Grayscale can approve additional authorized participants at any time. Broadening this network generally results in tighter bid-ask spreads and more efficient price discovery, making the ETF more attractive to sophisticated investors. These upgrades are widely regarded as key steps toward full-scale institutional engagement.
The latest changes reflect GXRP’s transition from early-stage development to a more mature, market-ready product, closely tracking the standards of larger spot crypto ETFs.
As Grayscale builds out the infrastructure behind GXRP, analysts note the move could have ripple effects on broader demand for XRP by tying ETF activity more closely to the underlying digital asset.
