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The likelihood of XRP ETF applications this year has increased due to the significant legal clarity gained for the token following the conclusion of the Ripple SEC case.
Ripple SEC Case Resolution and Impact
The long-running legal dispute between Ripple Labs Inc. and the U.S. Securities and Exchange Commission (SEC) has ended with a final decision on the settlements. This decision could potentially pave the way for the approval of a spot XRP ETF. While Ripple Labs faces a significant fine, the lawsuit provides significant legal clarity for its native token, XRP.
Increasing Speculation About XRP ETF Approval
The outcome of the case has fueled speculation about the possible approval of an XRP ETF. Bitinning founder Kashif Raza expressed optimism on X (formerly Twitter) about the future of XRP in the ETF market. He said:
“Sales of XRP to institutions violated securities laws. Pay a $125 million fine. Sales of XRP to retail did not violate securities laws. Relief to the XRP community… Expect XRP ETF applications soon.”
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ETF Store President Nate Geraci echoed this sentiment by asking the question “What about XRP ETF?” regarding X. He emphasized the importance of Judge Torres’ decision, emphasizing that Ripple’s programmatic sales of XRP to retail customers through exchanges did not violate federal securities laws.
This decision provides XRP with legal clarity that many other altcoins lack, thus increasing the chances of an XRP ETF application. Earlier this year, after the SEC approved Spot Ethereum ETFs, analysts began speculating about the possibility of ETFs for other altcoins, including XRP. Geoffrey Kendrick, an analyst at Standard Chartered Bank, was quite outspoken about this possibility.
Analyst Estimates and Market Outlook
Geoffrey Kendrick, head of forex and digital assets research at Standard Chartered Bank, offered an optimistic view on the situation. “As the market looks ahead, it is unlikely that this development will happen in 2024. This is because such an ETF approval would involve several steps. So even if an application is made immediately, the decision could be delayed until next year,” he said.
Kendrick also suggested that the approval of the Ether Spot ETFs shows that the SEC does not view ETH as a security. This logic could also apply to other altcoins such as XRP and Solana, with the possibility of an ETF launch by 2025. Supporting his prediction, VanEck and 21Shares filed for spot Solana ETFs last month.
The end of the Ripple SEC lawsuit has not only provided regulatory clarity for XRP but also increased the possibility of XRP ETF applications. While the market speculates on the potential of these ETFs, the regulatory landscape for cryptocurrency ETFs could see significant improvements in the next few years.
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