XRP Price Stalls as Spot XRP ETF Delays by SEC Create Uncertainty

In the past three months, the XRP price has fallen by 6% while the broader cryptocurrency market has gained 10%. The XRP ETF delays by the SEC have not helped this move in the opposite direction. XRP ETF delays include Coinshares and Bitwise XRP-spot ETFs, which have intensified the market certainty around Ripple’s token. 

Investors await the final verdict from the SEC vs Ripple case, which was almost concluded by Judge Torres rejecting the SEC’s request for lowering the fine and an indicative ruling on the injunction that prohibits XRP sales to institutional investors. The SEC might have to publicly admit its case was flawed and declare that XRP is a commodity. 

The legal drama will hopefully end soon, but XRP ETF uncertainties persist. The XRP ETF delays by the SEC are harming the token, and an approval could happen soon enough if the SEC drops its appeal. This will also help the XRP supply-demand trajectory. The XRP price tumbled 6.5% last week, and the only thing limiting the downside was optimism about a spot XRP ETF approval and a quick resolution to the legal case. 

XRP is the fourth-largest cryptocurrency by market cap. Analysts say there is robust investor interest for a spot XRP ETF, but XRP ETF delays by the SEC have recently also included Franklin XRP Fund and Grayscale’s XRP Trust conversion. According to Google Trends, XRP ETF is the most trending term among crypto ETFs, and institutional interest will ensure enduring success once approved. 

The current Bitcoin rally is also fueled by ETF momentum, and the same can be expected for Ripple (XRP). Spot Bitcoin ETFs have been the most successful in ETFs 32 32-year history and are valued at over $126 billion in assets under management. 

Reasons for XRP ETF Delays by the SEC 

Apparently, the SEC is instituting proceedings for additional analysis of each ETF application to help determine if it meets the SEC rules. The entire process is designed to protect investors and prevent fraudulent and manipulative acts and practices. 

The delays do not foretell whether the SEC will approve the ETFs. These XRP ETF delays are the latest for altcoin-based funds, and the SEC might even extend the deadlines of its decision. Solana ETF deadlines have been extended recently. 

The original decision deadlines were May 21-22, but they have been suspended to further examine whether the XRP ETF proposals meet the Exchange Act Section 6(b)(5) that protects investors by preventing fraud. 

Conclusion

The ongoing delays in the approval of spot XRP ETFs by the U.S. Securities and Exchange Commission (SEC) have introduced significant uncertainty into the XRP market. Despite the broader cryptocurrency market experiencing gains, XRP has seen a decline, highlighting the impact of regulatory decisions on investor sentiment.

The SEC’s postponement of decisions on multiple XRP ETF applications, including those from CoinShares, Bitwise, and Franklin Templeton, has been a major factor in this uncertainty. These delays are part of the SEC’s extended review process to ensure compliance with investor protection standards. 

However, there is a growing sense of optimism in the market. The recent settlement between Ripple and the SEC, which concluded a long-standing legal battle, has improved the prospects for XRP ETF approvals. Analysts now estimate a 65% to 86% chance of approval for XRP ETFs by 2025, reflecting increased confidence in the regulatory environment. 

Institutional interest in XRP remains strong, as evidenced by the performance of XRP futures ETFs surpassing that of Ethereum. This suggests that, once regulatory hurdles are cleared, XRP could experience significant growth driven by institutional investments. 

In conclusion, while the current delays have negatively impacted XRP’s price and market sentiment, the resolution of legal issues and the potential for ETF approvals present a promising outlook for XRP. Investors should stay informed about regulatory developments, as these will play a crucial role in shaping XRP’s future performance.

About the Author: Sarah Zimmerman is a seasoned crypto and Web3 news writer passionate about uncovering the latest developments in the digital asset space. With years of hands-on experience covering blockchain innovations, cryptocurrency trends, and decentralized technologies, she strives to deliver insightful and balanced news that empowers her readers. Her work is dedicated to demystifying complex topics and keeping you informed about the ever-evolving world of technology.