What to Know:
- Canary Capital’s XRP ETF (XRPC) had a strong debut, outperforming the Bitwise Solana ETF (BSOL) in first-day trading volume.
- Market analysis suggests that if 12 XRP ETFs mirrored XRPC’s initial inflows, it could result in nearly $3 billion in daily net inflows for XRP.
- While projections are optimistic, limitations exist, including the presence of futures-based ETFs and the potential for OTC trading to dampen immediate price impact.
The recent launch of the Canary Capital XRP ETF (XRPC) has sparked considerable interest in the potential impact of XRP ETFs on the market. With a strong debut that outshone other recent ETF launches, analysts are now speculating on how multiple XRP ETFs could influence XRP’s price and market capitalization. These projections, while not guarantees, offer a glimpse into the possible future of XRP investment.
The debut of the Canary Capital XRP ETF (XRPC) saw impressive figures, recording $58.5 million in trading volume and $245 million in net inflows on its first day. This performance surpassed the Bitwise Solana ETF (BSOL) and indicates strong initial investor interest in XRP exposure through ETFs. The ETF’s success underscores the growing demand for regulated crypto investment products.
Market commentator Chad Steingraber estimates that if 12 XRP ETFs replicated XRPC’s debut, it could lead to a combined $2.94 billion in daily net inflows. Steingraber suggests this level of investment could significantly boost XRP’s market cap, potentially driving its price upwards. However, this projection assumes all ETFs will perform equally well, which may not be the case.
Daily Avg Scenario = $245Million Inflow for 1 ETF Fund
x12 ETF Funds = $2,940,000,000 XRP Daily Net Inflow
100x Daily Market Cap Multiplier = $294,000,000,000 https://t.co/5eD4OD3n8H pic.twitter.com/hyDKQYAGGy
— Chad Steingraber (@ChadSteingraber) November 13, 2023
https://platform.twitter.com/widgets.js
It’s important to note that not all XRP ETFs are created equal; some are futures-based and do not directly influence XRP’s price through spot purchases. Additionally, even with strong inflows, much of the early buying may occur over-the-counter, mitigating immediate price impacts on public exchanges. Investors should consider these factors when evaluating the potential effects of XRP ETFs.
While the projections are optimistic, the success of XRPC signals growing institutional interest in XRP. The potential for increased ETF adoption could provide significant support for XRP’s price, similar to how Bitcoin ETFs have influenced BTC. As the regulatory landscape evolves, the role of XRP ETFs in the crypto market will continue to be a key area of focus for investors and traders.
Source: Original article
