Amplify introduces XRP-based option income ETF

Amplify has launched the XRP 3% Monthly Premium Income ETF, the first of its kind to track XRP exposure through options strategy.

Investors on the stock market have an ever-increasing number of crypto investment options to choose from. On Tuesday, November 18, Amplify ETFs launched the Amplify XRP 3% Monthly Premium Income ETF (XRPM).

Touted as a first-of-its-kind product, XRPM will use a covered options strategy to give investors XRP (XRP) exposure, while also offering yield. Namely, the fund will target an ambitious monthly yield of 3%, equivalent to 36% in annual returns.

XRP ETFs on the rise

Unlike spot crypto ETFs, the XRPM ETF will not invest in the underlying asset or hold XRP. Instead, Amplify will actively manage the fund through writing weekly call options. The strategy uses a high option premium with exposure to XRP.

The firm will write weekly covered call options on 30% to 60% of its portfolio. The remaining will be invested in futures products that go long on XRP. According to Amplify, this approach combines high yield potential with limited downside.

The XRPM ETF is one of several ETFs that recently launched. On November 13, Canary Capital launched its spot XRP ETF, which reached $58 million in volume on its first day. The interest came despite the overall bearish outlook in the crypto markets, primarily driven by dovish Federal Reserve policy.