Blackrock and Bitcoin logo on dark background with shiny details. 3D render. MUENSTER, GERMANY - June 17, 2023
- BlackRock is expected to file for Solana and XRP ETFs, potentially reshaping the crypto investment landscape as institutional demand grows.
- While a Solana ETF may be filed soon, an XRP ETF could depend on the resolution of Ripple’s ongoing legal battle with the SEC.
BlackRock, the world’s largest asset manager, is expected to file for Solana (SOL) and XRP exchange-traded funds (ETFs), according to Nate Geraci, president of The ETF Store. If this happens, it could significantly impact the crypto investment landscape, offering institutional investors more ways to gain exposure to these digital assets.
Why BlackRock May Pursue Solana and XRP ETFs
Geraci believes BlackRock will not allow its competitors to dominate ETFs for two of the top five non-stablecoin cryptocurrencies. With a growing appetite for crypto investment products, a Solana ETF filing could happen soon, while an XRP ETF may be delayed until Ripple’s ongoing legal battle with the U.S. Securities and Exchange Commission (SEC) reaches a conclusion.
Institutional Demand for Solana and XRP ETFs
The demand for institutional-grade investment products in the crypto market is increasing. Several asset management firms, including Grayscale, Bitwise, Franklin Templeton, VanEck, Canary Capital, and 21Shares, have already submitted applications for crypto ETFs, underscoring the growing interest in regulated digital asset investments.
According to a JPMorgan analysis published in January, Solana ETFs could attract between $3 billion and $6 billion in inflows within the first 6 to 12 months. XRP ETFs may see even higher demand, potentially pulling in $4 billion to $8 billion over the same period, based on the adoption patterns of Bitcoin and Ethereum ETFs.
Regulatory Uncertainty and the XRP Lawsuit
Despite growing enthusiasm for XRP ETFs, the token’s regulatory status remains uncertain. The SEC filed a lawsuit against Ripple Labs in 2020, alleging that the company sold XRP as an unregistered security. A judge ruled in July 2023 that institutional sales of XRP violated securities laws, but secondary market trading did not necessarily classify the token as a security.
Recent reports suggest the SEC and Ripple are working toward a settlement, with discussions focusing on adjusting penalties and aligning with new SEC policy changes. If XRP is reclassified as a commodity, its chances of ETF approval could improve significantly.
What’s Next for Solana and XRP ETFs?
BlackRock’s potential entry into the Solana and XRP ETF market could reshape the crypto investment space. With institutional demand rising and regulatory clarity improving, these ETFs may become a reality sooner rather than later. Investors should keep a close eye on upcoming developments, as approvals could drive significant market movements in the months ahead.
