- An analyst is bullish on the approval of an XRP ETF.
- He says BlackRock and Fidelity could soon join in.
- The SEC has until mid-October to decide on approval.
The US Securities and Exchange Commission’s approval of a spot XRP exchange-traded fund is not a matter of if, but when.
That’s according to Nate Geraci, president of investment advisor The ETF Store.
“Seems obvious spot XRP ETF approval [is] simply [a] matter of time,” Geraci said on Wednesday.
If approved, XRP will join the $104 billion crypto ETF market and become the third cryptocurrency to get its own spot fund, after Bitcoin and Ethereum.
The prediction comes after Ripple CEO Brad Garlinghouse announced on March 19 that the SEC will drop its long-running lawsuit against the XRP issuer.
Ripple developed XRP to facilitate cross-border payments.
The SEC sued Ripple in 2020 for allegedly breaching US securities law in its sale of XRP to both retail and institutional investors.
Last year, a US judge ruled that XRP sold on centralised crypto exchanges did not constitute a securities offering, but the sale of tokens to institutional investors contravened securities regulations.
Ripple chief legal officer Stuart Alderoty said on Tuesday that the regulator had agreed to drop its appeal of the judge’s decision without conditions.
More ETF applications?
The SEC is currently reviewing five XRP ETF applications. Investing giants BlackRock and Fidelity, pioneers of the spot Bitcoin and Ethereum ETFs, have not yet filed for XRP ETFs.
Geraci says that’s likely to change.
“I expect BlackRock, Fidelity, etc to all be involved,” he said. “[The] largest ETF issuers aren’t going to ignore this.”
In July, Samara Cohen, BlackRock’s chief investment officer for ETF and index investments, said that besides Bitcoin and Ethereum, no other cryptocurrency met the firm’s criteria for an ETF. Whether that’s changed since isn’t clear.
Northstake, a virtual asset service provider, estimates that investors will pour up to $800 million into XRP ETFs in the first week.
JPMorgan predicts investors will pour $8 billion into XRP funds in their first year of trading.
The SEC has until mid-October to decide on approval.
Approval odds soar
The chances that the SEC will approve an XRP ETF this year soared to 87% on Polymarket earlier this week.
That’s the highest the probability has ever been on the crypto prediction platform.
It signals the growing buzz around crypto ETFs, and the hopes that the crypto-friendly regulatory climate under US President Donald Trump could help expedite approvals.
However, while bettors are more bullish than ever on an eventual XRP ETF approval, they don’t anticipate it will happen until close to the October deadline.
The odds of an approval coming before July 31 have in recent weeks fallen to just 32%, the slimmest probability ever.
XRP trades at $2.37, down 5.5% on the week and some 30% below its all-time high.
Crypto market movers
- Bitcoin is down 0.8% in the past 24 hours to trade at $87,529.
- Ethereum is down 1.8% to trade at $2,033.
What we’re reading
- Fidelity’s stablecoin tests expand roster of players pushing into $238bn market ― DL News
- Why altcoin season hasn’t come — Milk Road
- 99% of Crypto Tokens Are Going to Zero: Fund Manager — CoinDesk
- Who is Paul Atkins? SEC pick with FTX links will oversee Trump’s crypto empire — DL News
- BlackRock expands blockchain-based money market to Solana, in tie-up with startup Securitize — Fortune
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.
