The success of the Bitcoin ETFs—launched this time last year—was unprecedented. And there’s a market for more crypto funds, according to analysts at America’s biggest bank, though that level of prosperity will be difficult to duplicate.
In a Monday report, a team of researchers at JP Morgan said that Solana and XRP ETFs could respectively pull in billions of dollars’ worth of cash from investors.
Still, vehicles for top altcoins would still fall well short of Bitcoin exchange-traded products or ETPs, the analysts said, predicting that XRP ETFs could attract $3 to $6 billion in investment, while Solana products could draw in between $4 to $8 billion.
“Regardless of an exact number, we think [Solana and XRP ETFs] will match if not fall below Ethereum ETP expectations given their altcoin status and, similarly, that Bitcoin remains the favored crypto token to trade and own both in spot and ETP form,” the report read.
It added that even if Solana and XRP funds are approved, they would end up managing billions of dollars in assets under management—and would be much smaller than the Bitcoin and Ethereum counterparts.
A number of asset managers—including Grayscale, VanEck, and Bitwise—have filed paperwork for XRP and Solana crypto funds.
XRP and Solana are the third and sixth biggest cryptocurrencies by market cap, respectively. Bitcoin and Ethereum take up the top two spots, respectively.
It would be very difficult to match the success of the Bitcoin ETFs, launched in January after the SEC gave them the green light to trade on stock exchanges: BlackRock’s iShares Bitcoin Trust, the biggest crypto investment vehicle, reached $50 billion in assets in its first year.
Ethereum ETFs hit the market last year too, but have been much slower to pull in money compared to their in-demand Bitcoin counterparts.
The analysts at JP Morgan added that “episodic nature of the crypto market is driven by varying investor sentiment and trendy new coins that may capture incremental attention for a limited time.”
Edited by Andrew Hayward
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