Nate Geraci, President of the ETF Store, recently stated that he believed Donald Trump winning the U.S. elections could help XRP ETFs move forward. On the Thinking Crypto podcast, Geraci said Trump’s promise to create a more crypto-friendly regulatory climate may result in the U.S. Securities and Exchange Commission taking a favorable view of XRP ETFs.
That said, a Trump victory won’t necessarily lead to approval for XRP ETFs. Yet, Geraci recognized that it could help build favorable conditions for such projects. The application to offer an XRP ETF from asset managers Bitwise and Canary Capital will allow institutional investors to access digital assets.
Surveillance Agreements Key for XRP ETF Approval
Geraci pointed out several existing hurdles for an XRP ETF, including a potential Trump administration that could help boost approval. A big one is the lack of XRP futures contracts on CME. It has been a factor in ensuring Bitcoin and Ethereum ETFs get approved.
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Future markets have established these assets as crucial to the SEC’s decision-making process. If there are no such futures contracts regarding XRP at the moment, it could make the regulatory outlook even more difficult.
The SEC has repeatedly leaned on this structure in approving a futures market. The SEC would also likely require a surveillance-sharing agreement to avoid market manipulation, a problem considering that XRP trades on mostly unregulated exchanges.
Political Climate Will Shape Future of XRP ETFs
Geraci emphasized the need for a more transparent regulatory framework across the cryptocurrency industry. However, he added that Congress needs to sketch out which digital assets would be deemed securities to smooth out the SEC’s regulatory processes.
Such legislation is essential for crypto-related financial products such as the XRP ETF, no matter the face of the political leadership. While that is difficult, Geraci was still optimistic about the long-term potential for crypto ETFs under a more permissive regulatory environment.
He also noted that broader regulatory clarity would benefit the whole industry, not just one project like XRP. Regulatory changes and the 2024 political climate will dictate the future of XRP ETFs.
Harris Campaign Focuses on Crypto and Equity
The politics of the cryptocurrency industry are divided between those who support regulation and those who support regulation but aren’t sure who would do a better job supporting it. Notably, Ripple co-founder Chris Larsen personally backed Kamala Harris.
Harris has clarified that Larsen has something to look for and that they both understand the country’s innovation economy. Harris recently indicated her support for cryptocurrencies. She discussed a requirement for a regulatory framework that empowered and protected Black men investing in the digital asset market.
Her stance has shifted from the broader skepticism seen during the current administration. However, it remains to be seen how her policies would affect crypto ETF approvals. With the election getting closer, the debate in the industry over how to best regulate the crypto sector has grown louder.
