The long-silent altcoin market has recently shown signs of recovery.
1. XRP's Market Capitalization Surpasses Solana, Becoming a New Market Focus.
On December 2, the price of the long-established altcoin XRP reached its highest point in seven years, with a market capitalization surpassing Solana, jumping to fourth place in the cryptocurrency market capitalization ranking. According to Coingecko data, XRP rose 17.6% in 24 hours, reaching a price of $2.28, with a market capitalization of approximately $130.1 billion. The direct reason for XRP's rise is the progress of the lawsuit between Ripple and the SEC, with former CFTC chairman Chris Giancarlo suggesting in an interview that the SEC should reconsider its approach towards Ripple, even speculating that it might drop the lawsuit. Additionally, driven by altcoins like XLM, Grayscale's investment portfolio market capitalization increased by 85% over the past month, with part of the surge in XLM's price attributed to Grayscale adding tokens to its trust. Meanwhile, data from the U.S. Ethereum ETF also reflects the arrival of the altcoin season, with the U.S. spot Ethereum ETF setting a new record for daily fund inflow on November 29, surpassing the inflow of the spot Bitcoin ETF for the day, leading several commentators to believe this signals Wall Street's 'official entry' into the rotation of altcoins.
1. Institutional Entry, Increase in Altcoin ETF Applications
Since the surge of Bitcoin spot ETFs, Wall Street giants have participated in pushing Bitcoin into mainstream markets. Now, the market's attention is turning to the next potential token that could attract significant investment from giants. Previously, Solana was favored, but now there are three ETF applications holding XRP, with Bitwise, Canary, and 21Shares all submitting spot XRP ETF applications. The global investment management company WisdomTree has also submitted a plan to establish an XRP ETF in Delaware, and it has launched related investment products in Europe.
3. Surge in Demand for Crypto ETPs, Divergent Performance in U.S. and European Markets.
1. U.S. Market: CoinShares' research director pointed out that the total assets under management for digital asset ETPs have first exceeded $150 billion, with the U.S. related products managing approximately $88.78 billion.
2. European Market: The Dominance of Crypto ETPs Remains Strong. As of November 28, Europe had a total of 221 cryptocurrency ETPs, with managed assets of $18.132 billion and a net inflow of $549 million over the past six months. Although Europe lacks genuine cryptocurrency ETFs due to UCITS regulations, the market size and development potential cannot be underestimated, and future regulatory easing is expected to boost the development of crypto ETFs.
4. Institutional Participation Accelerates ETP Market Transformation.
On October 20, asset management company VanEck indicated that institutional participation in European cryptocurrency ETPs was low at that time. However, the situation changed dramatically after the U.S. elections, with frequent actions from cryptocurrency ETP issuers in November. For example, on November 12, cryptocurrency research firm Kaiko acquired European cryptocurrency index provider Vinter; on November 27, Ripple invested in the Bitwise Physical XRP ETP fund; and on November 28, 21Shares added four ETPs to its European products.
In summary, altcoins like XRP have recently garnered significant attention, and altcoin ETFs are expected to become a driving force for growth. As the regulatory environment clarifies, crypto ETPs as investment tools will attract more investors, further maturing the market.
