XRP ETF Approval Rumors Re-ignite After News Of Potential Approval For ETH ETF

PATNA (CoinChapter.com)— Speculations of potential approval of Ether (ETH) ETFs by the US Securities and Exchange Commission (SEC) revived rumors of a Spot XRP ETF. However, the ongoing Ripple vs. SEC lawsuit remains a crucial factor in determining the future of a Spot XRP ETF market.

Potential for XRP Spot ETF Approval

The SEC’s recent request for Spot ETH ETF issuers to update their 19b-4 filings signals an imminent approval, sparking a 19.24% rally in ETH and a total crypto market cap gain of 9.18%, or $166.42 billion on May 20.

Furthermore, this regulatory shift towards Spot ETH ETFs raises the possibility of an XRP-spot ETF approval, which could propel the Ripple token higher. Historically, the SEC has been cautious with cryptocurrency ETFs, citing concerns about market manipulation and regulatory clarity.

However, recent comments from SEC officials suggest a more favorable stance towards Ether ETFs. Firms like BlackRock, VanEck, ARK Invest, Grayscale, and Fidelity have pending applications, some with critical deadlines approaching.

The approval of ETH-spot ETFs could set a precedent for other cryptocurrencies, including XRP.

In November 2023, XRP surged to $0.7503 on rumors of a BlackRock Spot XRP ETF filing, highlighting the market’s eagerness for such products. An official Spot XRP ETF approval could similarly boost XRP prices, potentially driving them back towards $1.

Ripple SEC Lawsuit and Its Impact

The ongoing Ripple-SEC lawsuit remains a significant hurdle for XRP-spot ETF approval. The case, nearing its conclusion, revolves around whether XRP should be classified as a security. On May 20, the SEC, Ripple, and any third parties filed briefs opposing the omnibus letter motions.

After the court ruling on the omnibus sealing motions, the parties have 14 days to file redacted versions of all documents.

The court will then decide on the penalty Ripple must pay for breaching US securities laws. Ripple anticipates a court ruling within the coming months. After the final ruling, the SEC can appeal against the Programmatic Sales of XRP ruling.

In its latest motion, the SEC opposes Ripple’s request to seal and redact financial and securities sales information, emphasizing the need for transparency. The SEC argues that Ripple has not shown exceptional circumstances justifying the sealing and that most of the evidence is either public or stale.

In July 2023, Judge Analisa Torres ruled that programmatic sales of XRP do not satisfy the third prong of the Howey Test.

The market’s reaction to the prospect of a Spot XRP ETF was evident in November 2023 when XRP’s price surged on fake news of a BlackRock filing. This incident underscored the significant impact that actual Spot XRP ETF approval could have on the market.

If the SEC decides not to appeal Judge Torres’ ruling, the path to a Spot XRP ETF could clear, potentially driving XRP prices significantly higher.

XRP Price Pares Gains

Meanwhile, XRP price pared its gains during late trading on May 21 after spiking nearly 5% to reach a daily high near $0.56. The Ripple token likely responded to rumors of the chances of a Spot XRP ETH, before traders started booking profits.

It seems the 200-day EMA (green wave) supply zone near $0.56 proved too much for the XRP price rally, making it the primary target for the bulls. As such, breaking and consolidating above the EMA resistance would likely see XRP price target the resistance near $0.587 before retreating.

However, the Spot XRP ETF rumors could become a double-edged sword for the XRP token. A substantial delay in the launch of XRP ETFs could introduce FUD into the market, forcing XRP price to drop to the 20-day EMA (red wave) support near $0.52.

Slipping below the immediate support level would see the Ripple token price test support near $0.5, which has been holding the XRP price up since Oct. 2023.

The RSI for XRP remained neutral, with a score of 55.83 on the daily charts.

The post XRP ETF Approval Rumors Re-ignite After News Of Potential Approval For ETH ETF appeared first on CoinChapter.