Bitwise, a trusted player in the crypto-focused asset management sector, has registered with the Delaware Division of Corporations for the establishment of a new entity called “Bitwise XRP ETF.” The filing is believed to lay the groundwork for a potential ETF product linked to Ripple’s XRP token.
ETF experts see a slim chance of approval if the SEC proceeds with an appeal.
Bitwise Chief Investment Officer Matthew Hougan confirmed the move after the news broke, adding that more details would come. Bitwise’s filing comes as the SEC’s deadline to appeal the Ripple case is approaching, and experts say an appeal will be filed soon.
The SEC is Anti Crypto
The SEC has until next Monday, October 7, to challenge the ruling made by Judge Analisa Torres in the Ripple case. Last year, Judge Torres ruled that while XRP sales to institutional investors were classified as securities, secondary market sales were not.
For Ripple, the decision was a major victory, but the SEC, due to its strong belief that the verdict was incorrect, indicated it may challenge the ruling. A former SEC lawyer said that everyone at the SEC “truly believes that the decision is wrong” and should be appealed, as reported by Fox Business analyst Eleanor Terrett.
If the SEC decides to appeal Judge Torress’ decision, the legal battle could be prolonged until next year. This may not only affect Ripple but also frustrate the wider cryptocurrency market.
The XRP token, despite being one of leading cryptocurrencies in terms of market cap, has seen price struggle since the SEC initiated the legal action against the company in 2020.
At its peak, XRP was valued at around $3.4, per CoinGecko. The cryptocurrency is currently trading at around $0.6, down around 82% from its all-time high.
The Take on SEC’s Potential Appeal
Nate Geraci, the ETF Store’s president, suggested that Bitwise’s move could be a bet on the outcome of the November election. In other words, the firm may anticipate a favorable outcome that would benefit the cryptocurrency industry, and, by extension, XRP and XRP ETF filing.
Geraci also noted Bitwise’s strong background in cryptocurrency and their latest registration is not a random move. He believes Bitwise’s decision to file for an XRP ETF is a well-planned strategy given their reputation.
Discussing Bitwise’s recent move, Alex Thorn, Head of Research at Galaxy Digital, and Bloomberg ETF analyst Eric Balchunas see near zero chance of approval for XRP ETF if the SEC appeals the Ripple case.
Balchunas also suggested that approval is unlikely if Kamala Harris wins the upcoming US presidential election. He believes a potential Trump victory will be a favorable outcome for the ETF.
Like Bitwise’s potential XRP ETF, VanEck’s Solana ETF bid is likely a bet on a Trump re-election.
Both Harris and Trump have articulated their positions on cryptocurrency as they campaign for the 2024 presidential election. Trump has actively courted the community by accepting donations in various cryptocurrencies and advocating for a national Bitcoin reserve.
At a recent Bitcoin conference, he proposed creating a government stockpile of Bitcoin, asserting that it would serve as a core component of U.S. financial strategy.
Meanwhile, the Vice President surprised the public after she expressed support for blockchain technology and digital assets last month, her first public remarks about the sector.
Harris promised that her administration would “encourage innovative technologies like AI and digital assets while protecting consumers and investors” during a fundraising event on September 22. Ahead of her statement, her campaign reportedly engaged with several cryptocurrency industry leaders and formed groups like Crypto4Harris to rally support.
Despite her efforts, Harris’s stance has drawn skepticism from some within the crypto community. Critics argue that her comments lack specificity and her administration’s approach to regulation is still vague.
The post Bitwise Files for XRP ETF as SEC Appeal Deadline Looms appeared first on Blockonomi.
