XRP ETF Moves Forward As CME Develops XRP Index: Report

• CME launches XRP reference rate and index, advancing XRP product development.
• SEC reviews two XRP ETF proposals from Bitwise and Canary Capital for institutional access.
• Analyst says XRP ETF approval may hinge on Trump’s election victory, despite challenges.

CME Group’s Senior Managing Director Tim McCourt spoke about the advancement of XRP-based ETFs at Ripple Swell 2024. He revealed that CME has launched an XRP reference rate and real-time index, which is a major advancement towards the growth of the XRP community. 

SEC Reviewing Proposals

McCourt’s remarks are made as the US Securities and Exchange Commission (SEC) is reviewing two XRP ETF proposals. Canary Capital filed after Bitwise Asset Management made its filing earlier. Both companies want to provide institutional investors access to XRP through their ETFs.

Geraci, the President of the ETF Store, shared his insights into the difficulties these applications encounter in an interview on the Thinking Crypto podcast. In the opinion of Geraci, one of the main problems is the absence of XRP futures contracts on the CME. Bitcoin and Ethereum ETFs were anchored on the existence of future contracts of these cryptocurrencies by CME. Since there are no futures contracts of XRP, the SEC could be hesitant to greenlight ETFs related to the cryptocurrency.

Political Influence on ETFs

As for the possibility of approving XRP ETFs, the expert said that it can only improve if Donald Trump wins the upcoming U.S. presidential election. Trump’s win would likely improve the regulatory climate for cryptocurrencies.

However, Geraci cautioned that the approval is not certain even if Trump wins the presidency again. The SEC would probably demand a co-surveillance agreement to avoid market fraud. Geraci also highlighted that the clear regulatory environment of Congress is important for the future of XRP ETFs and other cryptocurrencies. He said that such a framework will assist in determining which of the crypto assets are securities with a view of helping regulators and market players.

This is a positive development; however, there are still many issues to address when developing a regulated XRP benchmark. Changes in the political landscape and legal framework may affect the prospects and time frame of XRP ETFs’ launch. Until such issues are solved, the future of XRP ETFs will remain unknown.