As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed numerous shifts and transformations, from traditional assets to digital ones. The recent application by WisdomTree Digital Commodity Services LLC for the WisdomTree XRP Fund is an intriguing development that reflects the growing maturity of the cryptocurrency market.
WisdomTree Digital Commodity Services LLC, a subsidiary of WisdomTree Investment Inc (NYSE: WT), has submitted an application for the WisdomTree XRP Fund to the US Securities and Exchange Commission (SEC) through an S-1 filing. The New York-based asset management firm, with more than $113 billion in assets under management (AUM), intends to list its WisdomTree XRP Fund on the Cboe BZX Exchange.
As stated in the SEC document, WisdomTree has yet to determine the stock symbol for its XRP trust. Moreover, they anticipate adjusting their SEC filing at a later time to potentially boost the chances of getting approved, given that the expected sponsor fee is still unspecified.
The Bank of New York Mellon Corporation, listed on NYSE under the symbol BK, is set to act as the administrator for the trust’s financial matters, handle its accounting, and manage its share transfers once approved by the U.S. Securities and Exchange Commission.
A Growing Demand for XRP
The submission of the WisdomTree XRP Fund S-1 form to the U.S. SEC comes after last month’s debut of the WisdomTree Physical XRP Exchange Traded Product (ETP). This new offering, along with the existing ETP, provides investors with a secure entry point into the XRP market. Furthermore, it’s worth noting that the WisdomTree Physical XRP ETP is fully collateralized by XRP, thereby opening up an opportunity for non-U.S. institutional investors to invest in the altcoin.
As a crypto investor, I’ve been closely watching the predictions of Dovile Silenskyte, the director of digital assets research at WisdomTree. She believes that the increased adoption of XRP ($2.69) by institutional investors could potentially boost the diversity and stability of my crypto portfolio. With a 24-hour volatility of 41.6%, a market cap of $153.91 B, and a 24-hour volume of $51.34 B, XRP seems to be an intriguing asset to consider as part of my investment strategy.
Conversely, XRP boasts a smaller market capitalization than Ethereum and Bitcoin, potentially yielding lower returns as these two cryptocurrencies may experience decreasing returns.
As an analyst, I’ve noticed a growing trend: several fund management firms, including WisdomTree, are actively pursuing the launch of an Exchange Traded Fund (ETF) based on XRP in the US market. Notable among these contenders are 21Shares, Bitwise, Grayscale Investments, and Canary Capital, all of whom have submitted applications for a spot in this potential XRP ETF market.
Institutional investors’ increasing interest in XRP appears to be linked with the recent announcement of Gary Gensler’s resignation as the SEC Chair, suggesting that his departure could influence their investment decisions.
It’s highly probable that the upcoming shift in the U.S. Securities and Exchange Commission’s leadership may lead to the dismissal of legal actions against Ripple Labs. This potential development is seen as positive news for XRP holders.
Market Implications
The increasing interest among institutional investors in XRP is sustaining its positive trend. As Coinspeaker pointed out, this significant digital currency, valued at approximately $241 billion when fully diluted, surpassed other leading altcoins such as Solana (SOL), propelling it to the position of the third largest cryptocurrency excluding stablecoins.
Looking at the technical perspective, it’s likely that XRP’s price could surge past its previous record high from early 2018. This optimistic outlook is strengthened by the fact that XRP has already burst free from a larger triangular trend, suggesting the start of a new bullish phase. Furthermore, the RSI (Relative Strength Index) values for both weekly and monthly periods have spiked above 70, indicating that the bulls currently hold the upper hand in the market.
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2024-12-02 18:40