Bitwise's XRP ETF disclosed an unrealized loss of $25.937 million in its latest report, attributing the decline to falling XRP prices rather than active asset sales. The fund reported zero investment income and a net loss of $2.31 per share for the period.
Fund Structure and Holdings Exposed
Launched on November 19, 2025, and listed the following day, the trust holds 131.2 million XRP. Its portfolio is directly tied to XRP’s spot price, with minimal cash reserves beyond creation and redemption flows. The absence of diversification means any drop in XRP's price automatically erodes the fund's net asset value.
The report noted XRP’s price fell by approximately $1.44 during the period, reversing a strong start to the year that had drawn exchange interest. Franklin Templeton's competing XRP ETF offers a 0.19% fee, waived until the fund reaches $1 billion in assets, but the market downturn now pressures all similar products.
Unrealized Loss: Risk and Reversal Potential
The key nuance: this is an unrealized loss. If XRP prices recover, the paper loss would shrink or vanish. However, the fund remains fully exposed to further downside, as no hedging or cash reserves buffer against price swings. Investors should monitor XRP's price trajectory closely—the ETF’s performance is purely a bet on the token's future value.
This case underscores how even a “passive” holding ETF can suffer severe mark-to-market losses during crypto downturns, with no selling required to trigger red ink. For those evaluating crypto ETFs, the underlying asset’s volatility often outweighs fee structures or issuer reputation.