The Growing Demand for an XRP ETF

Introduction

The push for an XRP exchange-traded fund (ETF) is gaining momentum as Bitwise Chief Investment Officer Matt Hougan confirms growing investor demand.

In a CNBC interview, Hougan was asked about the demand for an XRP ETF. The host noted lesser demand for Ethereum ETFs compared to Bitcoin, while highlighting the increasing adoption for crypto products. “What does the outlook look like for an XRP fund?” the host inquired.

Strong Investor Demand

In response, Hougan emphasized a massive demand for a regulated XRP investment product in the U.S. He supported his view with two main factors:

1. Strong Community: Hougan highlighted that XRP has maintained a loyal and dedicated community over the years. He also pointed out that the asset consistently achieves significant trading volumes on centralized exchanges.

   For context, CoinMarketCap data indicates that XRP registered a trading volume of $3.74 billion in the past 24 hours and $33 billion over the last week, totaling over $162 billion in the monthly timeframe.

   Hougan remarked, “I think people would love to find a way to hold XRP in a simple, low-cost, easy-to-use ETP structure.”

Shifting Regulatory Landscape

The second major factor influencing optimism about an XRP ETF is the changing regulatory stance of the SEC.

Hougan pointed out the U.S. SEC’s increasing receptiveness to discussions surrounding new crypto assets under the current administration, contrasting this with the more restrictive approaches of previous years, especially regarding staking and in-kind issues.

He expressed hope that this evolving regulatory landscape could lead to the approval of XRP ETFs and other crypto-focused products, such as Solana ETFs.

Notably, the SEC has acknowledged six XRP ETF filings from various entities including Bitwise, Grayscale, and WisdomTree. Grayscale’s XRP ETF has advanced further, with the SEC entering it into the federal register, initiating an eight-month decision timeline.

Future Outlook

Looking ahead, Hougan also mentioned an optimistic outlook for an index-based ETF, describing it as the “killer app” in this field.
“A lot of people want to make a generalized bet on crypto, and I’m hopeful we’ll get that by the end of this year,” he stated.