XRP at Crossroads: ETF Hopes Meet Regulatory Challenges and Market Pressures

21Shares has filed with the U.S. Securities and Exchange Commission (SEC) to launch an XRP exchange-traded fund (ETF), joining Bitwise in the race to offer institutional exposure to the digital asset. However, the optimism surrounding potential ETF approvals is being tempered by Ripple’s planned record token sale and ongoing regulatory challenges.

XRP ETF Momentum Builds

The proposed 21Shares Core XRP Trust would allow investors to gain exposure to XRP’s price movements without directly holding the digital currency, following a similar structure to the successful ARK 21Shares Bitcoin ETF. This filing comes on the heels of Bitwise’s own XRP ETF application and Grayscale’s launch of an XRP Trust in September, signaling growing institutional interest in the asset.

Ripple CEO Brad Garlinghouse expressed confidence in the inevitability of XRP ETF approval, citing the massive success of Bitcoin ETFs, which have attracted approximately $17 billion in inflows since their January approval.

Ripple’s Regulatory Headwinds Persist

However, the optimism is being dampened by ongoing regulatory challenges. Ripple recently filed a Form C civil appeal to the U.S. Court of Appeals for the Second Circuit, countering the SEC’s appeal of Judge Analisa Torres’ landmark decision that ruled Ripple’s XRP sales on retail exchanges did not violate securities laws. The legal battle is expected to extend into early 2026, with a crucial SEC brief filing deadline set for January 15, 2025.

XRP Token Unlock: Market Pressures Mount

Adding to the uncertainty, Ripple has announced plans to sell 470 million XRP tokens, marking its largest monthly sale in seven years. This significant departure from its usual 200 million XRP monthly allocation has raised concerns about potential price pressure, particularly given XRP’s recent price vulnerability.

XRP/USD Technical Analysis

XRP currently trades around $0.507, showing bearish momentum with the RSI at 41, below the neutral level of 50. Key technical levels include:

• Critical support: $0.488
• Risk of 12% decline to $0.431 if support breaks
• Resistance at 200-day EMA: $0.548
• Upside potential to $0.626 (13% gain) if resistance breaks

XRP Price Prediction: Expert Insights

Bitget Research’s Chief Analyst Ryan Lee notes that XRP’s performance has been “relatively lackluster” in 2024, attributing this to the ongoing legal uncertainty and slow progress in technological development. “This endless cycle of lawsuits, appeals, and reversals has left large XRP holders feeling exhausted and anxious,” Lee commented.

Looking Ahead

The convergence of ETF applications, regulatory challenges, and Ripple’s planned token sale creates a complex landscape for XRP. While institutional interest through ETF proposals suggests growing mainstream adoption, the ongoing legal battle with the SEC and significant token sales could continue to pressure prices in the near term.

The January 15, 2025 SEC brief filing looms as a crucial catalyst that could significantly impact not only XRP but the broader cryptocurrency regulatory landscape in the United States. Investors and market participants will be closely monitoring these developments, particularly as they coincide with the upcoming U.S. presidential election period.