Trump Win Could Boost XRP & Solana ETFs, Says Bloomberg Analyst

Will Donald Trump’s Victory Affect XRP and Solana ETFs?

Bloomberg analyst Eric Balchunas has suggested that a potential victory for Donald Trump in the upcoming U.S. presidential election could significantly impact the fate of XRP and Solana exchange-traded funds (ETFs).

This commentary comes on the heels of Bitwise’s recent steps toward creating an XRP ETF by registering a trust entity in Delaware. This development is particularly timely, as it precedes the U.S. Securities and Exchange Commission’s (SEC) deadline to appeal Judge Torres’ ruling that secondary sales of XRP on exchanges are not classified as securities.

Trump’s Win Could Pave the Way for ETF Approvals

In a recent thread on X (formerly Twitter), Balchunas highlighted the challenges posed by current SEC regulations under Chairman Gary Gensler, which have made it difficult to approve new cryptocurrency ETFs, including those for XRP and Solana.

• Strict Regulatory Environment: Gensler’s stringent stance has negatively impacted major players like Binance and Coinbase.
• Potential for Change: Balchunas argues that a Trump victory could lead to a change in SEC leadership, resulting in more favorable regulations for cryptocurrency ETFs.
• The “Trump Call”: Those applying for XRP or Solana ETFs may essentially be betting on Trump’s win, hoping for a new SEC chair who is more amenable to approvals.

Conversely, Balchunas predicts that if Kamala Harris defeats Trump, existing regulations are unlikely to change, leading to lost opportunities for these ETFs. However, Harris has recently indicated a commitment to maintaining U.S. leadership in blockchain and AI, sparking some optimism for potential ETF approvals.

Bitwise Takes Significant Steps Toward XRP ETF

Bitwise has made a substantial move toward listing an XRP ETF by establishing a trust entity in Delaware. This follows other major investment firms like BlackRock and Fidelity, which have submitted applications for Bitcoin and Ether ETFs.

Despite these developments, the likelihood of approval remains uncertain:

• The SEC has until October 7, 2024, to appeal Judge Torres’ ruling that classified secondary sales of XRP as non-securities.
• Many experts, including former SEC officials, anticipate that the SEC will likely appeal this decision, which could further delay XRP ETF progress.

Analysts like Alex Thorn of Intangible Coins express skepticism about the chances of XRP ETF approval should the SEC proceed with an appeal.

Challenges for the Solana ETF

Similar to the XRP ETF, the proposed Solana ETF faces significant hurdles under the current SEC administration. Despite increasing demand for cryptocurrency-based investment vehicles, the SEC has been hesitant to approve new ETFs.

• Current Landscape: Nate Geraci, president of The ETF Store, has stated that the chances of a Solana ETF being approved within the next year or two remain slim.
• International Differences: In Brazil, two spot Solana ETFs have already been approved, highlighting the regulatory disparities between jurisdictions.

Geraci also emphasized that the political climate surrounding the 2024 U.S. presidential election could be critical for ETF approvals. A Trump presidency might lead to changes in SEC leadership and more lenient crypto regulations, while a Harris victory would likely maintain the status quo, leaving Solana and XRP ETFs unlikely to gain approval.

Conclusion

The upcoming U.S. presidential election could play a pivotal role in determining the future of XRP and Solana ETFs. As the landscape continues to evolve, investors should stay informed about regulatory developments and the potential implications of political changes on the cryptocurrency market.