With Bitcoin and Ethereum ETFs already in the bags, there are now indications that XRP, the core currency of the Ripple ecosystem, and Solana might be the next major cryptos to record the same feat. Already, top investment managers like VanECK have applied for the first Solana ETF in the United States. Known as VanECK Solana Trust, this product, according to the filing, will capitalize on the decentralized posture of Solana, its novel utility, and its economic feasibility to gain traction.
Although Solana ETF is yet to become available in the United States due to regulatory approval, it has gone live in Brazil. In fact, Brazil is the first country in the world to launch the product, reflecting its flexible stance towards crypto. With many analysts expecting the United States to follow suit, having taken a U-turn on its initial stance on BTC and ETH ETFs, the conversation is now shifting to XRP, another well-established cryptocurrency on the market.
At the time of writing, the United States Security and Exchange Commission (SEC) has received at least three filings for XRP ETFs, with two coming from Bitwise and Canary Capital. Taking this into account, the CEO of Ripple Labs, Brad Garlinghouse says the inclusion of XRP in a spot exchange-traded fund (ETF) in the United States was apparently “inevitable.” Garlinghouse says the filings demonstrate the growing demand for XRP among institutional and retail investors.
While applauding the SEC approval of BTC and ETH ETFs, the Ripple exec expressed optimism about the potential of an XRP fund to do well due to its vibrant community in the United States and overseas.
Which Factor Could Accelerate The Approval Of XRP ETFs In The US?
The outcome of the United States’ upcoming elections is a major factor that could fast-track the arrival of XRP ETFs. With current president Joe Biden officially out of the race, Kamala Harris has emerged as the new flagbearer of the Democratic party and will battle Republican candidate Donald Trump for the white house job. The upcoming election, according to many pundits, is a grand clash of ideals.
Donald Trump, on one side, has received accolades from many due to his pro-American posture and friendly remarks on cryptocurrency. Kamala Harris, on the other side, is renowned as an advocate of social justice and a liberal feminist whose anti-Trump antics have garnered admiration from Democrats. Meanwhile, with various promises centered around giving ground for Bitcoin and the entire crypto industry to thrive in the United States, Trump has earned more support from crypto influencers like Elon Musk.
Therefore, in the event that he wins the elections, Trump might sack the current SEC boss Gary Gensler who has been at the vanguard of Biden’s anti-crypto stance. If this happens, the XRP filings have a chance of approval before the second quarter of 2025.
However, if Harris emerges as the president, it might take a few years for XRP ETF products to take off in the United States. Considering how long it took for BTC and ETH to gain approval, it might be fair to affirm that XRP applications may not get a green light until 2027, especially if Gensler retains his job.
Final Words
The regulatory debate surrounding the status of XRP came to a logical end last year. In a landmark ruling around July 2023, US federal judge Analisa Torress ruled that XRP is not a security. While the SEC sought $2 billion in penalty, the court asked Ripple to pay $125 million.
This ruling, according to industry watchers, strengthens XRP’s chances of following the precedent of Bitcoin and Ethereum. However, in the event that the SEC appeals the ruling, the chance remains very slim.
That being said, the SEC still has a maximum of 240 days to approve or reject Bitwise’s XRP ETF filing, effective from the day it published it in its federal register.