Eleanor Terett emphasized the need for a futures-based XRP ETF as a precursor to spot-based approval. Over the past few weeks, speculation about a potential XRP ETF has been rife within the cryptocurrency community. XRP continues to witness significant wallet adoption, surpassing 5 million active wallets on the network.
The recent introduction of Bitcoin ETFs (exchange-traded funds) in the United States has sparked optimism about the possibility of similar ETFs for several cryptocurrencies, including XRP.
Fox Business correspondent Eleanor Terett has highlighted a crucial prerequisite for developing XRP ETFs.
Ripple (XRP) Needs a Future-Based ETF
Terett stated that for XRP to have a spot-based ETF, it first needs a futures-based ETF. Drawing parallels to the approval of Bitcoin spot ETFs, she emphasized that regulatory approval was granted based on confidence in the CME BTC futures market’s ability to provide oversight against fraud and market manipulation.
A comparable system would be essential for the approval of a spot XRP ETF. Terret explained it like this:
“To have an XRP spot ETF, there will first have to be a futures ETF. Part of the approval of BTC spot ETFs was the SEC’s conclusion that the CME bitcoin futures market would be sufficient to provide oversight against fraud and manipulation. If XRP gets a futures ETF, then it is a step in the right direction to one day get a spot.”
Her comments refer to speculation about an XRP ETF, fueled in part by Ripple’s job listing for a Senior Business Development Manager. She mentioned responsibilities, including leading cryptocurrency-related ETF initiatives, further aiding the rumors.
Despite the cryptocurrency community’s persistent advocacy for such an ETF, challenges loom due to Ripple’s ongoing legal battle with the SEC. This regulatory uncertainty has affected BlackRock’s interest in XRP.
No XRP Spot ETF Soon?
Earlier this month, the first 11 US bitcoin (BTC) spot ETFs were approved. The market expects XRP to be one of the coins for which a spot ETF will also be approved, but analysts say this will not happen anytime soon.
The SEC sued Ripple in late 2020 because it believes it sold XRP as an unregistered security (a type of exchange product), which is not permitted. This lawsuit remains pending, despite the court stating last summer that the coin was not sold on the secondary market under securities law. The lawsuit is expected to end next April.
However, the SEC does not seem particularly willing to curb its harsh policy. Recently, it asked Ripple to show financial documents, which Ripple, in turn, considered absurd. Thus, the regulatory body continues its efforts to bend demand to its will.
The approval of the new bitcoin ETFs also came rather reluctantly; The measure was not an endorsement of bitcoin itself.
Ripple (XRP): Network Adoption Increases
Despite the uncertainties surrounding a potential XRP spot ETF, the digital asset continues to witness significant adoption. Santiment, a blockchain analysis company, reported a substantial increase in active wallets holding XRP. The number of addresses with more than 0 XRP exceeded 5 million.
Notably, the count has doubled since February 2021, marking an increase of over 104%, and has tripled since May 2019. Despite these noteworthy developments, XRP price has not reflected the positive trend. observed in wallet activity throughout the year.
According to price data provided by a media outlet, after reaching a high of $0.63 on the first day of 2024. XRP price suffered a significant 19% correction, sliding towards the $0.50 range.
By Leonardo Perez
