Introduction to ETPs and cryptocurrencies
In recent years, Exchange-Traded Products (ETPs) have gained increasing attention in the cryptocurrency landscape. These financial instruments offer investors a simple and accessible way to invest in digital assets without having to manage cryptocurrencies directly. According to an estimate by JPMorgan, ETPs linked to XRP and Solana (SOL) could attract more than 15 billion dollars in net inflows. This article will explore the growth forecasts for these ETPs and the implications for investors
.
Historical performance of ETPs
To better understand the potential of XRP and Solana, it is useful to analyze the historical performance of other ETPs in the sector. Bitcoin (BTC) ETPs reached 108 billion dollars in assets in their first year of trading, representing 6% of BTC’s total market capitalization, which amounts to 1.8 trillion dollars. Similarly, Ethereum (ETH) ETPs achieved a 3% penetration rate in six months, accumulating 12 billion dollars in assets compared to a market capitalization of 395 billion dollars. Using these adoption rates as a reference, SOL is expected to see inflows of between 3 and 6 billion dollars, while XRP could attract between 4 and 8 billion
dollars.
Current situation of XRP and Solana ETPs
According to a recent CoinShares report, Solana-linked ETPs hold nearly 1.6 billion dollars in assets under management, while XRP products have 910 million dollars. In 2024, net flows for their ETPs reached 438 million and 69 million dollars, respectively. However, approving exchange-traded funds (ETFs) tied to these assets could significantly increase their total AUM. Bloomberg ETF analysts, James Seyffart and Eric Balchunas, recently pointed out that President-elect Donald Trump’s administration may favor new approvals, but ETFs linked to Litecoin (LTC) and Hedera (HBAR) are more likely to
be approved first.
Regulation and challenges for XRP and Solana
It’s important to note that XRP and Solana receive different treatments from the United States Securities and Exchange Commission (SEC). Recently, the SEC rejected ETFs linked to Solana, while Ripple Labs is still fighting with the regulator over whether XRP should be considered a security. Despite Bloomberg forecasts that indicate a new wave of ETFs this year, XRP and SOL products may be delayed. Investors must remain informed of regulatory developments, as these can significantly affect investment opportunities
.