Startup Based by Citi Alumni to Launch XRP-Backed Securities

Receipts Depositary Corp. (RDC), a start-up based by a gaggle of former Citigroup executives, is planning to launch XRP-backed securities, based on folks aware of the matter.

It will give establishments entry to XRP (XRP) securities by way of U.S. regulated market infrastructure.

The corporate will provide depositary receipts just like the American depositary receipts (ADRs) that signify overseas shares on U.S. fairness exchanges.

The product can be supplied to certified institutional consumers solely by way of transactions exempt from registration underneath the Securities Act of 1933. As such, it doesn’t want approval from the Securities and Alternate Fee (SEC).

Fox Enterprise reported the information earlier Friday.

The securities can be cleared by the Depository Belief Firm (DTC), just like RDC’s already present choices of bitcoin (BTC) and ether (ETH) backed securities.

In a press launch in January 2024, RDC founder and CEO Ankit Mehta, mentioned that utilizing depositary receipts brings many advantages, comparable to their “tried and true construction, offering direct possession of the underlying asset and simple inclusion in institutional merchandise.”

A number of firms have taken steps to carry XRP to an institutional crowd because the native cryptocurrency of the Ripple community has seen great progress over the previous 12 months. A number of asset managers and exchange-traded fund (ETF) suppliers have utilized for ETFs monitoring the value of XRP.

The distinction between an ETF and depository receipts is that whereas shares in a possible XRP ETF can be redeemed for money, depositary receipts would provide direct possession of the cryptocurrency.