TL;DR
- Bitwise has filed an application for an XRP ETF, but approval is uncertain due to the lack of a regulated market.
- Cryptocurrencies, including XRP, have suffered price declines amid geopolitical tension.
- Privacy tokens are facing a surge in delistings due to regulatory pressure in several countries.
The cryptocurrency market has seen notable moves in recent days, with Bitcoin approaching $64,000 following the release of positive US jobs data that has allayed fears of a recession.
Amidst this scenario, Bitwise, one of the largest cryptocurrency ETF managers in the country, has filed an application for an XRP ETF.
However, this news has not had the expected effect on the price of XRP, which has been hit by a general market decline, exacerbated by current geopolitical tensions.
Bitwise CEO Hunter Horsley has stated that XRP is an “enduring crypto asset that many investors want exposure to.”
Despite the application submission, the path to approval of an XRP ETF remains complicated.
According to Kaiko analysts, the main hurdle lies in the SEC’s concerns about market manipulation.
Our latest Data Debrief is out now.
This week we looked at @BitwiseInvest's $XRP filing and the chances of approval. Read the report below 👇https://t.co/7OkvkvMK0Q pic.twitter.com/tQBaQruwNX
— Kaiko (@KaikoData) October 7, 2024
Unlike Bitcoin, which has seen the approval of a futures-based ETF, XRP lacks a regulated market where reliable reference prices can be established .
This makes the chance of the SEC approving an XRP ETF anytime soon extremely low, especially considering that the SEC is still in the middle of a legal battle with Ripple Labs, the company behind XRP.
The outlook is further complicated by instability in the macroeconomic environment.
The recent volatility of the Japanese yen has had an impact on cryptocurrency trading volume in Japan, which has remained stagnant at around $200 million per day, half the average recorded between January and July.
This indicates a decline in Japanese traders interest in the crypto market, while trading volumes in markets such as the US and Korean markets have increased.
Regulation and future of Crypto
Regulatory pressure has intensified for privacy tokens, leading platforms like Kraken to delist assets like Monero.
This trend towards delisting has led to a significant drop in privacy token prices, which have seen a notable increase in delistings this year.
Regulation in countries like South Korea, Japan, and Australia is motivated by concerns about money laundering and consumer protection, limiting trading options for these assets on more regulated platforms.
As the regulatory landscape evolves, it becomes crucial for digital asset issuers to ensure that effective measures are in place to prevent fraud and price manipulation.
Established players in the cryptocurrency space, such as Grayscale and Bitwise, are looking to expand their offerings to include products that might appeal to US investors, but they face a challenging regulatory environment that complicates their efforts.
Attention now turns to how upcoming events in the regulatory and policy space will influence the future of digital assets and their market adoption.
Uncertainty and volatility will continue to be key factors impacting market performance in the short term.
