After the green light was given for Spot Bitcoin ETFs, market analysts have kept sharing their views on the prospect of additional crypto ETFs, including a potential XRP ETF, being introduced in the near future. The latest voice to join this discussion is Ripple‘s CEO, Brad Garlinghouse, who has weighed in on the likelihood of further crypto funds emerging soon.
“There Will Be Other ETFs”
During an interview at the Paris Blockchain Week, Garlinghouse expressed his belief that there will be more crypto-ETFs in the future. However, he cautioned that this may take some time due to the SEC’s caution towards crypto assets. The SEC is famous for taking regulatory action against various crypto projects, such as Ripple.
In the same vein, Garlinghouse proposed that XRP could be included in an ETF when the opportunity arises, given its unique regulatory clarity. Notably, XRP and Bitcoin are the only cryptocurrencies with clear regulatory guidance. This distinction stems from Judge Torres’ ruling that XRP is not classified as a security.
Some market experts, including Van Buren Capital’s Scott Johnsson, hold a less hopeful view than Garlinghouse regarding the imminent approval of an XRP ETF. Johnsson stated that the chances of the SEC granting approval are “very slim.” He also suggested that a change in leadership at the SEC, with Gary Gensler stepping down, could be a prerequisite for the approval of an XRP ETF.
Cathie Wood, CEO of Ark Invest, previously expressed her belief that only Bitcoin and Ethereum Spot Exchange-Traded Funds (ETFs) would be approved in the US market. She suggested that it was unlikely for an XRP ETF to be considered due to the SEC’s stance on recognizing other cryptocurrencies apart from Bitcoin and Ethereum.
What Needs To Happen Before An XRP ETF Can Launch
The Securities and Exchange Commission (SEC) has raised concerns about the XRP token, and Bloomberg analyst James Seyffart identified another potential hurdle for an XRP Exchange-Traded Fund (ETF) launch. According to him, since XRP isn’t listed on a regulated exchange such as Chicago Mercantile Exchange (CME), it decreases the likelihood of the SEC granting approval for an XRP ETF.
The SEC had previously dismissed Bitcoin Spot ETF proposals due to concerns over market manipulation. However, in the Grayscale case, it was determined that the spot and futures markets were linked. This decision facilitated the subsequent approval of these funds as Bitcoin futures were already traded on the CME.
If XRP futures are listed on the CME, it might make it easier for XRP ETFs to be approved. This is because regulators could view the CME’s regulation as a safeguard against market manipulation.
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2024-04-12 22:41