XRP (XRP-USD) traded below $1.40 on Friday evening, shedding 3.7% over 24 hours, even as a new Securities and Exchange Commission (SEC) order broadened the regulatory pathway for crypto exchange-traded products. The decline, which pushed XRP to $1.3971 on Coinbase, came amid a wider market selloff triggered by stronger-than-expected U.S. payroll data.
The SEC's order, issued Thursday, approved amendments to Nasdaq Texas Rule 5711(d), which governs generic listings for commodity-based trust shares. The changes allow for a 15% portfolio buffer, define "digital commodity," and permit active management. This means certain crypto ETFs can list without bespoke rule-change proceedings for each launch.
However, the order does not approve any specific XRP fund. It names no issuer, launch date, or fee structure. The distinction is crucial: while the rule broadens the infrastructure, it does not create immediate spot demand for XRP tokens.
Friday's price action illustrated this gap. XRP reached $1.4622 before the U.S. payroll release, then sank as low as $1.3832. The Labor Department reported 162,000 new jobs in August, triple the consensus estimate, which lifted Treasury yields and pressured risk assets like cryptocurrencies.
Regulatory Progress, Not Approval
The SEC's 23-page order, released as Release No. 34-106268, grants Nasdaq Texas's request to allow up to 15% of a trust's net assets to include digital commodities or securities that don't meet existing eligibility tests. The remaining 85% must still comply with current standards. Managers can actively adjust holdings within stated mandates, but sponsors must monitor the 85% threshold daily and halt trading if required data disappears.
XRP appears in the order alongside bitcoin, ether, and solana, with the SEC noting all four currently qualify under existing criteria, including regulated futures or derivative-market tests. This is useful regulatory recognition but not a token-specific exemption.
The new definition of "digital commodity" is broader, covering assets whose value derives from functional crypto systems and supply-demand dynamics rather than managerial efforts. This language follows joint SEC and CFTC guidance effective in March.
Market Impact and Fund Flows
For existing products, the impact is muted. The Canary XRP ETF (NASDAQ:XRPC) reported $364.25 million in net assets and 248.28 million XRP held as of Sept. 4, with shares outstanding unchanged at 23.4 million from Sept. 2. Net assets rose from $333.61 million two days earlier, but that increase reflects XRP's price appreciation, not new creations.
The immediate driver of Friday's decline was macro. Bitcoin lost $80,000, Treasury yields climbed, and XRP followed the broader rate-sensitive trade. The weekend test is whether XRP holds above Friday's low of $1.3832. A move back through $1.45 would suggest buyers are valuing the expanded product pipeline.
Analysts caution that the SEC order improves the road but does not supply the traffic. A break below $1.3832 would indicate macro conditions still dominate over listing architecture. The first strong confirmation of bullish impact would come from filed products, rising share counts, or sustained spot volume.
Risks remain: XRP trades continuously across venues with price divergence, sponsor data may lag, and the SEC can revisit listing standards. The order is a step forward for crypto ETF infrastructure, but Friday's 3.7% decline serves as a reminder that regulatory plumbing and market demand are separate forces.
