As a seasoned researcher with years of experience studying cryptocurrency markets, I’ve seen my fair share of bull runs and bear markets. The potential approval of an XRP ETF has got me particularly excited, as it could bring about a significant shift in the crypto landscape.
Optimism about XRP‘s price soaring has been rekindled by Bitwise Asset Management’s filing for an XRP ETF in Delaware. If accepted, this would mark the first XRP-based ETF available on the U.S. market. Currently, investors are debating how this potential development could influence XRP’s future value. The approval of such an ETF could significantly boost XRP’s price, particularly if it attracts investments similar to Bitcoin‘s $47 billion.
If XRP ETF Approved, Ripple Price Could Skyrocket
Should an XRP ETF receive approval, its value might significantly increase. To predict just how high it may rise, it’s essential to examine the reactions of Bitcoin and Ethereum when their respective ETFs were approved.
- Bitcoin Reaction: When the spot Bitcoin ETF was approved on January 10, 2024, the market saw a massive influx of capital, exceeding $1.6 billion just minutes into the launch.
Over the subsequent months, the escalating interest I observed propelled Bitcoin’s value by approximately 39%. At present, it maintains a steady position around the $61,500 mark.
- Ethereum Reaction: The approval of the Ethereum ETF in June 2024 led to investor interest and substantial inflows. While the ETH ETF initially saw some inflows, the outflows have generally become significant, and the Ethereum price dropped. Since the launch, the price of Ethereum has not surpassed the high of $3,521. Instead, the asset has lost 30% of its value and is trading at $2,478 today.
After the introduction of the Ethereum ETF, its performance has been relatively low, possibly because of reduced market volatility due to global economic uncertainties. This situation made investors more inclined towards Bitcoin as a safeguard against inflationary risks.
- Potential Ripple Price Reaction: If an XRP ETF were to receive approval, we could expect an either/or situation, drawing from Bitcoin and Ethereum’s performance.
If an additional $47 billion were to flow into the XRP market (currently valued at $34 billion), it would lead to a significant increase in the Ripple price. This surge could potentially see the price doubling to around $1.5, and even tripling to approximately $2.49 under optimistic predictions.
Why XRP ETF is Different Than BTC or ETH ETF
As a crypto investor, I recognize that an XRP-focused ETF wouldn’t mirror Bitcoin (BTC) or Ethereum (ETH) in every aspect. Unlike BTC and ETH, which can be impacted by Grayscale outflows, the potential XRP ETF may not experience the same downside pressure due to unique characteristics as identified by Sistine Research on X.
XRP has 1/9 the market cap of ETH and 1/35 that of BTC.
Even a few billion in ETF flows would likely have a large impact on price.
And it would have no Grayscale outflows to fight.
— Sistine Research (@sistineresearch) October 1, 2024
This unique aspect would make XRP ETFs more attractive to investors. Despite their performance today, Bitcoin and Ethereum ETFs recorded huge inflows during their first trading day. ETH ETF registered $107.8 million, while Bitcoin recorded $4.5 billion. Nevertheless, both the ETFs experienced outflows Grayscale despite the positive volume.
Because XRP doesn’t face the same selling pressure from Grayscale, its price might see a prolonged upward trend.
Conclusion
It seems that the prospect of an XRP ETF being approved has become more promising, following Bitwise Asset Management’s application for an ETF with Delaware officials. Unlike Bitcoin and Ethereum ETFs, this new one might perform exceptionally well due to reduced outflow pressure from Grayscale. As a result, the value of XRP could potentially soar to $1.5 or even higher.
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2024-10-02 13:36