In summary
- XRP is up 430% since November, hitting $2.67 on regulatory hopes and potential investment products in the US.
- CoinShares saw significant inflows into XRP-related products, driven by the potential of an ETF.
- Gary Gensler’s resignation as SEC Chairman sparked optimism about more favorable regulation for XRP.
As the price of investment focused on XRP.
Since Election Day last month, the token managed by Ripple Labs has been one of the best assets in the Cryptocurrency market, outpacing the relative gains of Bitcoin and Ethereum. For example, since November 5, the price of XRP has quintupled, rising 430% to $2.67 from $0.50.
Whether it’s WisdomTree or 21Shares, several asset managers have recently filed applications for products that would give traditional investors exposure to the spot price of XRP. While the development could expand investor access to cryptocurrency in America, similar products already exist outside the US and have recently seen notable inflows, according to CoinShares.
The European fund manager reported on Monday that digital asset products for XRP have seen inflows of $95 million over the past week. Accounting for 67% of total inflows into such products this year, the performance lifted investor allocations to XRP to more than $141 million so far this year.
James Butterfill, Head of Research at CoinShares, wrote on Monday that traders are likely speculating about the approval of an exchange-traded product for XRP, a development in the US that Ripple CEO Brad Garlinghouse described as “inevitable.” ” in October.
“We believe (XRP’s record weekly inflows) are due to the excitement surrounding the potential for a US ETF,” Butterfill wrote, pointing to last week’s $95 million in allocations to XRP products.
Launched in 2013, XRP is the native asset of the Ripple Network, a payments system designed for international money transfers and currency exchanges. Fox Business reported last week that the New York Department of Financial Services is expected to approve a stablecoin issued by the long-established online fintech company.
While XRP, the token, operates independently of Ripple’s payment and settlement products, Sidney Powell, co-founder and CEO of Maple Finance, told Decrypt that the cryptocurrency is benefiting from Ripple’s “very strong brand recognition” in the crypto space.
“I think it has a lot of legacy value because of how long it has been in circulation,” Powell said of XRP. “It’s obviously a very well-established cryptocurrency, and Ripple itself is a very well-established business.”
Powell described a recent Ripple conference as different compared to other crypto events he has attended. At the conference, called Ripple Swell, Powell observed a notable number of institutional participants, from investment to commercial banks, he said.
According to Jake O., an OTC trader at market maker Wintermute, the jump in XRP price over the past week is comparable to the subsequent rise of Iota and Hedera. In the last seven days, both coins have risen 66% to $0.38 and 116% to $0.29, respectively.
Becoming the third-largest digital asset by market capitalization this weekend, Ostrovskis attributed XRP’s recent strength to traders navigating the crypto market on their own. “The resurgence of the retail market shows no signs of slowing down,” Ostrovskis wrote in reference to XRP’s jump on Monday.
“The increase in interest around XRP coincided with the jump in the App Store rankings of Coinbase and Robinhood,” the Wintermute trader added in a statement. “This is indicative that the retail market is driving the initial move, although, as volume and liquidity has increased, we have seen an increasing number of institutional traders chasing momentum and volatility in the asset.”
Meanwhile, XRP was the third most traded digital asset on Monday, behind only Bitcoin and stablecoin Tether, according to CoinGecko. With over $56 billion worth of XRP exchanged over the past day, the cryptocurrency had surpassed Ethereum and Dogecoin in terms of volume.
Four years ago, Ripple was sued by the U.S. Securities and Exchange Commission (SEC), which accused the firm of violating its rules by allegedly selling $1.3 billion in XRP as an unregistered security. Although a federal judge later found that XRP “is not necessarily a security in and of itself,” the SEC has appealed the ruling.
The announcement of Gary Gensler’s resignation as chairman of the SEC, which will take effect when Donald Trump assumes the presidency next year, was received with optimism by the crypto ecosystem. This positive reaction is mainly due to the fact that, under Gensler, the cryptocurrency industry has faced one of the strictest and most restrictive regulations in its history, characterized by multiple lawsuits against crypto projects and a particularly aggressive approach towards the sector.
Among digital assets expected to benefit from a potential shift in the SEC’s regulatory approach, Nick Cowan, CEO of asset manager VLRM, told Decrypt that XRP’s “staggering” rally has been driven in part by renewed regulatory hopes.
“XRP is up a staggering 400%, most likely helped by growing sentiment that the SEC’s legal battles may be coming to an end, along with Gensler’s announcement that he will be leaving the SEC on January 20,” Cowan said. in a statement.
Edited by Andrew Hayward
Editor’s Note: This story was updated after publication to include another comment from Wintermute OTC Trader Jake O.
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