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Trump win could boost XRP ETF approval

Trump win could boost XRP ETF approval

GrafaGrafa2024/10/16 04:00
By:Mahathir Bayena

Nate Geraci, President of ETF Store, has outlined factors that might increase the likelihood of the U.S. Securities and Exchange Commission (SEC) approving applications for XRP (CRYPTO:XRP) exchange-traded funds (ETFs). 

In an interview on the Thinking Crypto podcast, Geraci highlighted the potential influence of Donald Trump's election victory on the SEC’s stance toward crypto regulations, suggesting that a Trump administration could foster a more crypto-friendly environment, thereby raising approval chances.

Geraci explained, “Trump’s win might increase the chances of launching ETFs, but it does not mean approval is guaranteed.” 

While a favorable political climate could support the launch of XRP ETFs, there remain significant regulatory challenges. 

Asset managers like Bitwise and Canary Capital have already submitted applications to offer institutional investors exposure to XRP. 

However, the SEC's stance on cryptocurrencies has been predominantly cautious under the current administration.

The absence of XRP futures contracts on the CME poses a major hurdle, as futures markets have played a crucial role in the approval of Bitcoin and Ethereum ETFs. 

Geraci remarked, “I believe that futures markets are necessary due to how the SEC operates.” 

Unlike Bitcoin (CRYPTO:BTC) and Ethereum (CRYPTO:ETH) ETFs, which connected spot and futures markets to gain SEC approval, the lack of futures trading for XRP makes its path to approval more uncertain.

Geraci also noted that the SEC would likely seek a surveillance-sharing agreement to prevent market manipulation before approving an XRP ETF. 

The lack of regulation across exchanges trading XRP adds to the complexity, as the SEC's stringent requirements for market oversight would be difficult to meet without clearer guidelines.

He suggested that a broader regulatory framework defining which crypto assets are classified as securities would benefit the entire industry. 

Despite the challenges, Ripple co-founder Chris Larsen appears more supportive of Kamala Harris, acknowledging her understanding of innovative economics and having donated $1 million in XRP to her campaign.

At the time of writing, the XRP price was $0.5413.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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