- Ripple was apparently looking for crypto-related ETF initiatives.
- Analysts have expressed concerns about such a possibility.
With the mocking Bitcoin [BTC] ETFs that are active, and Ethereum [ETH] ETFs in the pipeline, a certain segment of the crypto market has turned its attention to the possibility of even a spot Ripple [XRP] ETF.
Is the hype justified?
Much of the anticipation stemmed from Ripple’s legal victory over the US Securities and Exchange Commission (SEC), which cleared up doubts about XRP’s “security status.”
However, a Fox Business journalist who has been closely following developments surrounding spot crypto ETFs has given these speculations a reality check.
Eleanor Terrett said that to launch an XRP spot ETF, a futures ETF would have to be in place first.
She reminded everyone that Bitcoin spot ETFs were given the green light partly because the SEC deemed the CME Bitcoin futures market good enough to monitor for fraud and manipulation.
“Like XRP gets a futures ETF, then it’s a step in the right direction to get a spot one day,” Terrett said.
Her comments came in response to a job description from Ripple, in which the company was looking for a resource that could “drive cryptocurrency-related ETF initiatives.”
Wishful thinking?
The discussions around XRP ETFs have been building for a while. Around mid-November, fake news about BlackRock’s launch of an XRP ETF caused the coin to rise 12%, wiping out the investments of millions of futures traders.
When BlackRock CEO Larry Fink was recently asked about the prospect of an XRP ETF in the near future turned down to give a definitive answer by saying, “I can’t talk about that.”
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But contrary to what XRP proponents might want to believe, an XRP ETF may be too far-fetched at this stage.
Bloomberg ETF Analyst James Seyffart concerns about such a possibility were expressed months ago.
“Don’t think there is enough to launch an XRP ETF with this SEC. And there seems to be essentially no demand from issuers to try it.”