Franklin Templeton's XRP Fund Draws Fresh Capital as Ripple Expands Into Leveraged ETF Financing

Franklin Templeton's XRPZ took all new XRP ETF subscriptions as spot assets hit $1.81B; Ripple Prime now finances leveraged ETF equity swaps.

US-listed XRP exchange-traded funds pulled in net new money against a softening backdrop for the wider crypto market, with the entire intake landing in a single product. Franklin Templeton's XRPZ accounted for all of the fresh subscriptions, while the four other XRP funds trading stateside logged neither inflows nor outflows on the day. Cumulative assets across the spot funds now stand at roughly $1.81 billion since launch.

The targeted buying arrived during a stretch of pronounced unease across crypto trading, after a wave of liquidations in leveraged positions weighed on prices. Macroeconomic factors and a pullback in risk appetite drove the selling rather than anything specific to XRP.

Spot trading has steadied after the turbulence. XRP changed hands at $1.38, holding 7.8% above its 200-day moving average of $1.28, while sitting 52% below its 52-week high.

Ripple Prime Enters Leveraged Fund Financing

On the institutional side, Ripple is pushing deeper into traditional US finance. Its Ripple Prime unit is financing equity swaps for leveraged exchange-traded funds, according to a Wall Street Journal report — a niche long dominated by established investment banks. The token was quoted at $1.40 as the news circulated.

The push targets one of New York's faster-growing corners of finance. Data from Morningstar Direct puts the US market at 593 leveraged ETFs with more than $256 billion in combined assets, of which 426 are single-stock products that deliver a leveraged bet on one company's shares. The Tradr 2X Long SNDK Daily ETF, which tracks twice the daily move in Sandisk stock, is the first named user of the financing service. It pays a variable fee tied to the Overnight Bank Funding Rate plus a spread of four percentage points, with annualized costs for the fund's assets recently running near 8%.

The groundwork for the business came through Ripple's $1.25 billion acquisition of prime broker Hidden Road, which became Ripple Prime and now serves more than 300 institutional clients. The division also reported regulatory net capital above $1 billion. On Tuesday the firm widened its partnership with Brevan Howard, an asset manager overseeing roughly $35 billion for institutional clients, with Ripple Prime providing multi-asset prime brokerage, clearing and financing for the firm's funds.

Custody Shift and a Ledger Upgrade

Institutional plumbing around the asset is shifting on several fronts. Grayscale amended the custody arrangement for its XRP Trust ETF and entered an agreement with Anchorage Digital Bank, per mandatory filings with the SEC.

The underlying network is evolving in parallel. After weeks of validator voting, the XRP Ledger activated the PermissionDelegationV1_1 upgrade, letting account holders assign up to ten task-specific permissions to other accounts without sharing private master keys. The feature is aimed squarely at institutions and asset managers that want to separate control from payment functions in daily operations. According to an Evernorth report, the ledger carried an average of $3.72 billion in tokenized assets during the second quarter, alongside $539 million in the stablecoin RLUSD.

Real-World Settlement Takes Shape in Brazil

Away from trading flows, the operational use of the blockchain is drawing more attention. In Brazil, market infrastructure provider CSD BR launched a collaboration with Ripple to mirror and verify ownership records for BTG Pactual investment funds on the XRP Ledger, with official registers staying inside the custodian's systems. The effort shows how institutions are evaluating the network chiefly for audit and transaction pathways.

Whether such pilots generate lasting demand for the native token itself will hinge on actual usage frequency and the liquidity committed to these institutional settlement channels. For investors, the open question is how forcefully Ripple's operational expansion feeds through to the token: the Ripple Prime financing business generates revenue for the company but does not yet necessarily use the token or its main network. XRP added 1.5% on the day, though it remains 51% below its 52-week high of $2.88. Whether the institutional groundwork is enough to create sustained demand for the token depends largely on how tightly the prime brokerage services are eventually woven into Ripple's own network.