XRP has surged to a 7-week high, closing at $2.4712 on Saturday, May 10th, fueled by speculation that asset management giant BlackRock (BLK) might be eyeing an XRP-spot ETF. This development has injected a fresh wave of optimism into the XRP market, already buoyed by recent positive legal developments in the ongoing SEC vs. Ripple case. Â
The speculation gained traction after a crypto enthusiast, Amelie, shared a purported letter indicating that BlackRock had met with the SEC’s crypto task force to discuss ETF approval standards, specifically mentioning a potential “BlackRock XRP ETF coming soon!” While BlackRock has remained silent on these rumors since debunking a fake XRP ETF filing in November 2023, their significant success with the iShares Bitcoin Trust (IBIT), which has amassed substantial inflows since its January 2024 launch, has fueled hopes for a similar product for XRP. Â
SEC Sentiment Shift and Legal Breakthroughs
Adding to the positive sentiment is a perceived shift in the SEC’s stance towards crypto. Crypto America host Eleanor Terrett highlighted the increased engagement between the SEC’s crypto task force and industry participants, a stark contrast to the previous four years.
Furthermore, the SEC recently filed a settlement letter with the courts in the Ripple case, requesting the lifting of an injunction that prohibits XRP sales to institutional investors and a reduction in the penalty to $125 million. If approved, both parties would drop their appeals, potentially concluding the long-running legal battle and paving the way for greater regulatory clarity for XRP, a crucial factor for ETF approval.
Market Outlook and Price Analysis with XRP ETFs
The market is clearly betting on a positive outcome. Polymarket, a prediction market, currently places the odds of an XRP-spot ETF approval by December 2025 at a significant 77%.
Technically, XRP is showing bullish momentum, trading above both the 50-day and 200-day Exponential Moving Averages (EMA). A break above the May 11th high of $2.4813 could signal a further move towards the March 19th high of $2.5925, with potential targets of $3 and the 2025 high of $3.3999 if the bullish trend continues.
Conversely, failure to maintain support above the 50-day EMA could lead to a drop towards the 200-day EMA and the $1.9299 support level. The Relative Strength Index (RSI) at 63.30 suggests there is still room for XRP to rise before entering overbought territory.
The XRP ETFs Effect
The potential approval of an XRP-spot ETF could be a game-changer for the cryptocurrency. Bitcoin ETFs have already demonstrated the significant impact such regulated investment vehicles can have, providing traditional investors with easier access to digital assets and potentially driving substantial institutional inflows. BlackRock’s entry into the Bitcoin ETF market, with the remarkable success of IBIT, underscores their influence and ability to attract significant capital.
An XRP ETF could similarly broaden its investor base, increase liquidity, and lend further legitimacy to the digital asset. This could be particularly impactful for XRP, which has faced regulatory uncertainty for an extended period
It’s important to note that while the BlackRock ETF speculation and Ripple legal developments are key drivers for XRP, the cryptocurrency remains sensitive to broader market conditions. Rising trade tensions and recession fears continue to influence risk assets, including cryptocurrencies.
Key Takeaways for XRP Investors
The near-term trajectory of XRP hinges on several factors:
- Judge Torres’ ruling on the SEC settlement request.
- The SEC’s decision on whether to pursue an appeal in the Ripple case.
- Developments related to potential XRP-spot ETF filings, particularly any official announcements from BlackRock.
If the legal hurdles clear and an XRP ETF gains traction, the cryptocurrency could indeed target its all-time high and potentially move even higher. However, investors should remain vigilant and consider the inherent volatility of the cryptocurrency market and the influence of macroeconomic factors. The current surge fueled by speculation highlights the potential for significant price movements based on ETF hopes, but official confirmation and broader market sentiment will ultimately dictate XRP’s future direction.
