Multiple XRP ETPs Drive Liquidity Surge: Here’s What To Know
Anticipated Influx Of Liquidity In XRP Market
The XRP market could soon experience a surge in liquidity due to the imminent arrival of multiple XRP Exchange-Traded Products (ETPs), with one set to debut in the European market next month. Also, DeFi Technologies, a prominent technology firm, recently revealed its intentions to launch an XRP-based exchange-traded product (ETP) through its subsidiary Valour next month.
This announcement triggered anticipation within the XRP community of institutional investment in XRP. Meanwhile, a well-known member of the XRP community, Zach Rector, also revealed that he received credible notice from community influencer Chad Steingraber that 21Shares XRP ETP (AXRP) from Swiss financial technology company 21Shares is about to launch.
Despite being introduced four years ago, AXRP recently gained public attention for its XRP focus and currently boasts over $49M in assets under management (AUM) with a Year-to-Date (YTD) yield of +69%. Rector also highlighted the ETC Group Physical XRP (GXRP), from German-based cryptocurrency ETP issuer ETC Group.
Implications For XRP Community And ETF Advocacy
The arrival of multiple XRP ETPs will significantly impact the XRP market, primarily by boosting the asset’s liquidity. These investment products provide an easier route for institutional and retail investors to access XRP.
Moreover, ETPs bring the allure of regulated and secure investment avenues, attracting a broader spectrum of investors and contributing to improved price discovery. Regarding XRP, the digital asset’s ecosystem has advocated for the launch of a spot XRP ETF in the United States following the asset’s legal clarity.
Calls for this intensified following heightened interest and price upswings in crypto assets after recent news of a fake BlackRock XRP ETF filing spread.
Gensler’s Past Recognition Of Ripple’s ODL
Meanwhile, reports indicate US SEC chair Gensler had previously acknowledged the potential of Ripple’s solutions for facilitating international payments. During a 2018 economic forum exploring blockchain’s impact on finance, Jo Marie Griesgraber raised concerns about high cross-border remittance costs and inefficiencies between countries like Tanzania and Nigeria.
Thus, she sought clarity on utilizing blockchain technology to achieve low-cost, instantaneous international transfers without Bitcoin. Gensler responded, saying blockchain is viable for cost-effective cross-border transactions without relying on Bitcoin.
Then, he mentioned using a ‘bridge currency,’ like XRP, to facilitate seamless transactions between fiat currencies. He noted that Ripple’s pilot, xRapid (later named Ripple On-Demand Liquidity – ODL but now called Ripple Payments), began in May 2018 as an experimental effort.
Gensler’s Changing Perspective
Interestingly, Gensler’s acknowledgment of xRapid’s role in leveraging XRP for cross-border payments contrasts with his subsequent labeling of XRP as a security in a 2020 lawsuit before a recent court judgment affirmed that XRP tokens are not securities.
Similarly, in 2019, Gensler recognized Algorand (ALGO) for its technology’s potential, likening it to a platform capable of hosting services like Uber. However, the SEC chairman categorized ALGO as a security in an April 2023 lawsuit.
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