Franklin Templeton has submitted a proposal to create an exchange-traded fund centered around Ripple’s XRP, joining firms like Bitwise, Canary Capital, and others in the race to establish XRP ETFs.
Franklin Templeton has filed to launch Ripple (XRP) ETFs that will track the asset’s spot price after accounting for fees. The ETF shares will be available for trading on the Cboe BZX exchange, with Coinbase serving as the custodian. However, investors in these ETFs will not receive any benefits from XRP-related forks or airdrops.
In its bid to introduce Ripple ETFs, the firm aligns itself with other notable participants like Bitwise, 21Shares, WisdomTree, CoinShares, Canary Capital, and Grayscale Investments, all vying to bring XRP-based investment options to market. The U.S. Securities and Exchange Commission (SEC) is already reviewing the proposals from these organizations and is in the midst of rendering approval decisions. Furthermore, it is essential to mention that the SEC has postponed its ruling on Grayscale’s XRP ETFs until May.
As stated by analysts at Bloomberg, the likelihood of XRP ETFs receiving approval is estimated at 65%, which places them at a lower probability than those for Litecoin (LTC), Solana (SOL), and even Dogecoin (DOGE).
However, it’s worth noting that these odds were released back in February and do not account for more recent developments. In particular, there are indications that the legal disputes between Ripple Labs and the SEC may be drawing to a close, according to journalist Eleanor Terrett.
The market’s response to this news displayed a typical pattern of buying on rumors and selling on facts. Initially, the reports regarding the potential resolution of the XRP case led to a 4% rise in XRP’s price over a 24-hour span. However, as the excitement subsided and no further updates emerged, selling pressure ensued, evident from the four consecutive bearish candles observed on shorter timeframes.
With the Ripple lawsuit possibly coming to an end, particularly in light of the SEC’s recent dismissal of lawsuits against other cryptocurrency firms, the approval for XRP ETFs appears increasingly attainable. This case has likely been the primary obstacle to Ripple-based ETFs due to the regulatory ambiguity surrounding XRP’s classification as a security. If this regulatory barrier is finally cleared, the introduction of XRP ETFs could shift from mere speculation to a tangible reality, paving the way for more sustained price movements for XRP. Additionally, Franklin Templeton’s entry into the XRP ETF arena is a promising indicator, suggesting they believe there is a solid chance for approval.