Even with the expected launching of the exchange-traded funds (ETFs) and what seems to be a shift towards cryptocurrency friendly politics in Washington, XRP faced a minor downturn. On April 17, Thursday, XRP declined by 0.86%. On Wednesday, XRP faced a reduction of 0.03%. Subsequently, XRP closed at $2.0652. During this period, the cryptocurrency market registered an increase of 0.95% thus bringing the total market value of crypto currencies to $2.63 trillion.
Futures ETFs Set Stage Amid Legal Backdrop
XRP related ETFs are still a hot talking point in the market even as the legal tussle between SEC and Ripple labs continues to unfold. ETF provider ProShares has added more fuel to this buzz by filing an amendment on April 15 to its earlier registration submitted on January 17 with the SEC. This update set April 30 as the new effective date for launching three XRP Futures ETFs: ProShares UltraShort XRP ETF, ProShares Ultra XRP ETF, and ProShares Short XRP ETF.
ProShares UltraShort XRP ETF Hopes Hinge on Multiple Factors
The issuance of these ETFs is highly viewed by ProShares enthusiasts as fueling hopes for direct XRP spot ETFs which could be realized by 2025.
This expectation is somewhat sustained by the pending victory of President Trump in the 2024 elections and the expected rise in more crypto-friendly leadership in the SEC, possibly Paul Atkins as chair. Five of the leading issuers, Bitwise, Canary Funds, 21Shares, Grayscale, Coinshares, WisdomTree, and Franklin Templeton have already started filing for XRP spot ETFs, claiming their first mover advantage.
Legal, Regulatory, and Macroeconomic Factors Affecting XRP’s Price
XRP appears vulnerable on the price front due to downside risk from multiple directional influences. Within the blockchain and crypto industry, the SEC vs Ripple saga is still priority number one; resolving it may be the catalyst that boosts XRP to revisit its all-time high of $3.5505. On the other hand, multiple hurdles yet to be passed in the spot ETF approval process may dampen expectations. In addition to crypto-specific factors, macroeconomic events can make a significant impact too.
The ongoing U.S.-China trade tensions, coupled with U.S. Federal Reserve policy decisions, are potential concerns that may push XRP towards the $1.70 support level. If these external pressures are alleviated, however, XRP is likely to rally towards $3.00.
Mixed ETF inflows kept Bitcoin (BTC) on a sustained rally as XRP faced headwinds.
Santiment, a market intelligence platform, shared hopes for de-escalation of the U.S.-China trade conflict and its subsequent effects on Bitcoin’s future price: “As crypto traders patiently wait to observe fundamental triggers which would warrant a FOMO trading frenzy, we saw recently Trump taking aim at Jerome Powell for not cutting rates. He has in the meantime teased a ‘Very Good Deal’ with China.” These sentiments tie into the previously discussed Ethereum crypto rally as traders passionately await a legislation-driven market boom.
While Trump’s comments can be categorized as mere speculation, a widely accepted notion is that potential trade agreements would significantly boost the crypto economy. The effect of economically motivated uncertainty has been persistent; after Trump’s threat of tariffs, Bitcoin lost 19 percent while traditional safe-haven gold gained 19 precent.
The lack of Oswaldian clarity, in combination with the Fed’s higher-for-longer interest rates policy, have limited demand for the recently launched spot Bitcoin ETFs.
On April 17, Bitcoin added 1.11%, and on Wednesday, another 0.39%, which puts Bitcoin at a closing price of $84,963, though still under $85,000 for the fifth day in a row. In the short-term, BTC price movements are expected to depend on whether bullish (trade tensions easing, dovish signals from the Fed, legislation supportive like the Bitcoin Act, ETF inflows) or bearish (escalating tariffs, hawkish Fed, ETF outflows, stagnant legislation) factors dominate, respectively moving the price towards $90,000 or $75,000.
What Lies Ahead?
For the investors who follow cryptocurrency, tracking certain interrelated themes is critical. Important themes include tracking news related to the ongoing Ripple court case, U.S.-China trade relations, macroeconomic data releases, upcoming Fed policy indications, ETF flow patterns, and any new developments related to cryptocurrency policies within the United States. Ripple’s legal verdict has particular relevance in the context of XRP, but the overarching trend still stems from regulatory advancement accompanied by economic certainty.
