Crypto investment firm Canary Capital has filed for a spot XRP ETF with the U.S. Securities and Exchange Commission, following Bitwise’s lead in pushing for XRP-based financial products. This marks a growing confidence in cryptocurrency products beyond Bitcoin and Ethereum.
Positive Sentiment and Regulatory Challenges
Canary Capital is optimistic about a "progressive regulatory environment," yet significant uncertainties persist. The SEC recently filed an appeal challenging the July 2023 ruling that XRP is not a security when traded on secondary exchanges, adding new complexities to the ongoing legal battle with Ripple Labs. This appeal raises questions about whether the XRP ETF filings by Canary and Bitwise will receive approval amidst ongoing regulatory scrutiny.
Uncertain Path Forward for XRP ETF
Steven McClurg, Founder of Valkyrie Funds and the driving force behind Canary Capital, is confident in the firm’s move despite these challenges. He highlighted the increasing demand from institutional and retail investors for access to cryptocurrencies beyond established assets like Bitcoin and Ethereum. The ETF will use secure cold and hot wallets to manage XRP and provide a simpler way for investors to gain exposure to the token without the complexities of direct crypto management.
Path Forward for XRP and Other Altcoins
The SEC’s regulatory crackdown on the crypto industry continues to impact the status of altcoins like XRP, and many speculate that the agency’s appeal in the Ripple lawsuit could stall progress on the XRP ETF filings. Though the SEC has approved Bitcoin and Ethereum ETFs, other crypto assets face regulatory ambiguity. Approval of the XRP ETF, as well as ETFs for other altcoins like Solana or Dogecoin, remains uncertain under the SEC’s current stance.
Despite these hurdles, Canary Capital's filing marks a significant step in the broader push to bring altcoins into traditional financial markets through ETFs. Whether or not the regulatory environment evolves favorably, this move reflects a growing belief in the long-term potential of cryptocurrencies like XRP.