If given the go-ahead, it is likely that newly developed crypto-related exchange-traded products (ETPs) could draw a substantial influx of fresh investments, as suggested by the global investment powerhouse, JPMorgan.
Increasingly, investors are wagering on the acceptance of the initial Solana (SOL) and XRP (XRP) exchange-traded funds (ETFs), as they anticipate a more progressive regulatory environment in the U.S., following the inauguration of President-elect Donald Trump on January 20th, which may foster innovation.
According to a report given to CryptoMoon on January 13th, JPMorgan anticipates that ETPs based on Solana (SOL) and Ripple (XRP) could outperform exchange-traded funds focused on Ethereum (ETH) in their first half of trading.
According to the report, when using the term “adoption rates” for Solana (SOL) and Ripple (XRP), we find that Solana could potentially attract between 3 billion to 6 billion dollars worth of additional assets, while Ripple might amass around 4 billion to 8 billion dollars in new assets.
The forecast follows close on the heels of the one-year mark since the debut of U.S. Bitcoin (BTC) ETFs, which amassed a total value of nearly $110 billion as of January 2nd, according to CryptoMoon’s report.
As a researcher examining the crypto market, I’ve noticed an intriguing trend: The introduction of new crypto-based ETFs could potentially drive the values of underlying altcoins to unprecedented peaks. In the case of Bitcoin, these ETFs were responsible for approximately 75% of fresh investment when Bitcoin surpassed $50,000 again on February 15, just under a month following the debut of spot BTC ETFs on January 11.
Altcoin ETP adoption unknown due to uncertain investor demand
The idea of an ETF built around Solana (SOL) or Ripple (XRP) has sparked much excitement among investors, but such predictions assume the pace at which Bitcoin and Ethereum ETFs have been adopted will be similar.
Approximately 6% of Bitcoin’s overall market value has been garnered by Bitcoin ETFs, indicating a 6% adoption rate for these investment vehicles. In their initial six months, Ether ETFs have managed to secure a 3% adoption rate.
Nevertheless, the desire for altcoins among investors tends to be more volatile, making it challenging to forecast the success of the upcoming crypto-based ETF, as suggested in JPMorgan’s report.
“Outside of a few primary tokens (BTC, ETH, SOL), the episodic nature of the crypto market is driven by varying investor sentiment and trendy new coins that may capture incremental attention for a limited time.”
“We don’t see tokens with such limited depth successfully hosting an ETP,” the report added.
SOL ETFs near SEC deadline at the end of January
A number of prominent investment firms have applied for a Solana Exchange-Traded Fund (ETF), among them are VanEck, Grayscale, 21Shares, Bitwise, and Canary Capital.
By the close of January 2025, initial decisions are anticipated from the U.S. Securities and Exchange Commission regarding these applications. Specifically, Grayscale’s application has a deadline set for January 23rd, while other applicants are looking forward to receiving their decisions by January 25th.
According to Alejo Pinto, the creator of the Lumio layer-2 network on the Solana blockchain, an approval for an Exchange Traded Fund (ETF) could potentially have a substantial effect on Solana’s market value.
He stated that since the approval of an ETF for Solana in the U.S. remains quite unpredictable, its potential positive effect on the price could be significant because the likelihood is currently low and not reflected in the market yet.
Read More
- RLC PREDICTION. RLC cryptocurrency
- OKB PREDICTION. OKB cryptocurrency
- CAKE PREDICTION. CAKE cryptocurrency
- TRB PREDICTION. TRB cryptocurrency
- POL PREDICTION. POL cryptocurrency
- XDC PREDICTION. XDC cryptocurrency
- FLOKI PREDICTION. FLOKI cryptocurrency
- ZEN PREDICTION. ZEN cryptocurrency
- TRAC PREDICTION. TRAC cryptocurrency
- SXP PREDICTION. SXP cryptocurrency
2025-01-14 15:01