Bitwise has filed for an XRP ETF in Delaware. This marks a major step towards its potential launch.
An XRP ETF could have a major impact on the crypto market in terms of liquidity and attracting institutional investors.
The ongoing legal battle between Ripple and the SEC could influence the agency's decision.
Rumors of an XRP ETF have been circulating for months.
The outcome of the 2024 U.S. elections could affect the approval process.
Bitwise, one of the biggest crypto asset managers has taken a major step this week.
This step was taken towards the launch of a new XRP exchange-traded fund via filing.
According to reports the application was filed in the state of Delaware and has been confirmed by both the Delaware Division of Corporations and a spokesperson from Bitwise.
In essence, we might be seeing a third ETF option soon.
Interestingly this new filing marks a major milestone for the US financial markets (particularly crypto). However, it still doesn't guarantee an immediate submission to the SEC.
Here’s everything you need to know about Bitwise’s latest move in the crypto space.
The filing was submitted on 30 September when the company submitted its XRP ETF application.
This is interesting considering how XRP is the seventh-largest crypto by market cap. It also follows recent approvals of Bitcoin and Ethereum ETFs from earlier In the year.
For context, ETFs are popular investment vehicles that track the price of their underlying asset.
They also trade on stock exchanges and allow their owners to hold crypto without having to buy it directly.
The ETFs registered with Bitcoin and Ethereum this year alone have brought in millions of dollars in inflows. This has led to a massive wave of speculation and hype for XRP as the recent filing goes from desk to desk.
Interestingly, XRP ETFs have been referred to as “inevitable” several times by Ripple and non-Ripple executives.
For example, Ripple’s CEO Brad Garlinghouse hinted in a FOX Business interview that this new investment product was "inevitable."
He said that an XRP ETF would happen one way or another, especially since the launch of the Bitcoin and Ether ETFs in the U.S.
Nate Geraci, the president of the ETF Store and co-founder of the ETF Institute also mentioned something similar in a 2 October tweet.
“Bitwise positioning to file for XRP ETF is highly noteworthy," he said "Bitwise is a highly credible crypto-native fund firm that doesn't just throw stuff at the wall. This is strategic.”
“An XRP ETF is Probably coming at some point,” he said “Bitwise is just early”
If approved, this ETF would allow an even wider range of institutional investors to gain exposure to XRP.
This will likely drive up liquidity and encourage even wider adoption of XRP.
Bitwise’s recent filing comes amid Ripple Labs' ongoing legal disputes with the SEC.
As far back as December 2020, the SEC sued Ripple under claims that its sale of XRP counted as an unregistered securities offering.
This lawsuit has hung over XRP like a dark cloud for years. However recent developments seem to be giving investors some relief.
For example in July 2023, Judge Analisa Torres ruled that XRP is not a security when sold on public exchanges.
This counted as the first partial victory for Ripple.
On the other hand, the ruling also stated that institutional sales of XRP could be treated as securities.
Fast forward to September 2024 (last week): Both Ripple and the SEC have requested a stay on the case’s final judgment, pending the outcome of the latter’s appeal.
In essence, this means that all court meetings are now temporarily paused.
Leaving the future of Ripple—and XRP—up in the air.
Even before a legitimate filing, rumors of an XRP ETF have been swirling for months.
A fake filing for a “BlackRock iShares XRP Trust” in Delaware hit the internet sometime in November 2023.
This alone led to a temporary 12% surge in XRP’s price.
The filing was eventually debunked and Delaware prosecutors are still investigating the source of this misinformation.
Today, considering a legitimate filing, XRP appears more poised than ever to make things work.
In the charts, the cryptocurrency has now retested the upper trendline of the descending channel above.
This indicates a possible rally on the news of the recent filing. Unless we see a break below the cryptocurrency’s 25-day EMA around $0.58886.
Possible price targets for the cryptocurrency go as high as $0.7 to $1.
As it stands, the major player in the entire game is the SEC itself.
The agency ultimately holds the final decision over whether we indeed see an XRP ETF or not.
So far, the agency has been slow to approve crypto-related ETFs. Instead, it prefers to take a cautious approach to things.
Moreover, the outcome of Ripple's ongoing legal battle with the SEC could also influence how things play out.
The current SEC Chair Gary Gensler has been vocal about maintaining his famously harsh regulatory landscape of the crypto market.
However, his future in office could depend mostly on the outcome of the 2024 U.S. elections.
Gensler is expected to keep his seat if Kamala Harris wins (or even gets a promotion). However, if Donald Trump does, we might see a change in leadership and a change in crypto regulations.
In sum, it could mark a major turning point for crypto if the XRP ETF receives approval.
For now, there are no guarantees for anything with Bitwise’s filing serving merely as a signal of what could come.
A lot still depends on the regulatory and legal landscape within the market in the months ahead.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.