New York-based asset management firm WisdomTree Funds is filing in Delaware to register an XRP exchange traded fund (ETF). The company says the preliminary registration serves as a notice that it intends to file with the U.S. Securities and Exchange Commission (SEC).
This puts WisdomTree in a club of firms will launch the first of their kind (XRP focused) ETF.
The registration signals growing ETF competition in the cryptocurrency market, especially for XRP based products. Already Bitwise, Canary Capital and 21Shares have filed similar applications. None, however, have yet been approved by the SEC, a testament to the hurdles facing such projects.
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WisdomTree is expected to soon file an S-1 registration statement with the SEC. It would represent the next step in seeking regulatory approval of the fund. That entry further accelerates a race to be the first U.S.-approved XRP ETF.
Ripple SEC Case Clouds XRP ETF Prospects
Ripple Labs vs. SEC has added some uncertainty around XRP ETFs. In July 2023, the principles were that XRP is not a security in some matters. However, the SEC appealed the decision, and the delay of additional proceedings has been reserved until January 2025.
That’s the reason behind the SEC’s apparent legal ambivalence toward the XRP focused ETFs, with asset managers unsure of what exactly is permissible and permitted. They say a positive outcome for Ripple could send other ETF approvals into high gear.
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But while Ripple’s partial legal victory has given the firm a confidence boost, it hasn’t solved the underlying regulatory risks.
Ripple’s CEO is hopeful about the increasing need for cryptocurrency ETFs, in particular among institutional investors. But he pointed to the success of Bitcoin ETFs as a sign of robust market interest. In that case, Ripple’s future legal outcomes will likely hold a key in the SEC’s decisions path.
Political Shifts Raise Hopes for Crypto ETFs
Under U.S. political changes, hopes increase for crypto-friendly regulatory policies. SEC Chair Gary Gensler’sresignation and a new administration’s take may clear the way for crypto ETFs. A shot in the arm for cryptocurrency products, analysts predict conservative appointees could reshape financial oversight.
If the incoming administration deprioritizes ongoing lawsuits against Ripple and companies like Ripple, etc., it could speed up regulatory approvals for XRP ETFs.
Industry observers say this could be a tipping point for cryptocurrency-backed financial products.
Given this, WisdomTree’s decision to push an XRP ETF is a vote of confidence in asset managers’ eyes for the future, and wisdom will be granted to them. The fact that increased filings signal optimism about the future of crypto ETFs under changing political and regulatory conditions.
If Ripple’s case goes well, the US could soon have its first XRP-backed ETF.
