XRP ETF Buzz Heats Up As Crypto Investors Flee Bitcoin, Ethereum Funds
**XRP Emerges as Leading Contender for Spot ETF Approval in the U.S.**
In what could mark a transformative moment for cryptocurrency investing in the United States, XRP is increasingly viewed as the altcoin most likely to secure spot ETF approval—surpassing rivals such as Solana, Cardano, and Litecoin. According to a report published Monday by market intelligence firm Kaiko, XRP’s growing liquidity in the U.S. market, recent favorable legal rulings, and the rollout of leveraged ETF products have positioned it as the front-runner in the race for regulatory approval.
### XRP Overtakes Rivals in Liquidity and Market Depth
XRP, currently the fourth-largest cryptocurrency by market capitalization, has achieved its highest level of spot trading volume on U.S. exchanges since 2020. This resurgence follows a lengthy period of market suppression triggered by an SEC lawsuit that led to widespread delistings.
Kaiko’s data reveals that XRP has surpassed Solana in terms of 1% market depth on regulated platforms and now boasts double the liquidity of Cardano. These metrics—key indicators of market health and stability—strengthen the case for a spot ETF based on XRP.
"XRP’s favorable market trends put it ahead of other altcoins in terms of spot ETF approval," Kaiko analysts stated in the report.
### Regulatory Barriers Ease After Partial Legal Victory
XRP’s path to a spot ETF has been significantly cleared by Ripple Labs’ partial legal victory against the U.S. Securities and Exchange Commission (SEC) in 2023. The court determined that XRP sales on public crypto exchanges did not qualify as securities when sold to retail investors. Although Ripple was found to have conducted $728 million in unregistered institutional sales, the company paid a $50 million fine to settle the matter—resolving a major regulatory overhang.
This favorable outcome, coupled with the SEC’s earlier approval of leveraged XRP-based investment products, has encouraged market participants and fund managers to push forward with more traditional ETF offerings. Notably, Teucrium Investment Advisors recently launched a 2X leveraged XRP ETF, debuting with a strong $5 million in trading volume—their most successful product launch to date.
### Institutional Sentiment Shifts Despite Broader Crypto Outflows
While XRP gains momentum, traditional digital asset investment vehicles are witnessing historic outflows. According to CoinShares, crypto funds have seen $7.2 billion in redemptions since February—marking the worst stretch of outflows on record. Just last week, Bitcoin ETFs experienced $751 million in outflows, while Ethereum-based products saw $38 million in withdrawals.
Despite this broader market retreat, analysts urge caution in interpreting short-term volatility. “I don’t see this as anything particularly ominous,” said James Butterfill of CoinShares, suggesting that strategic positioning rather than fundamental concern may be driving these shifts.
### Multiple XRP Spot ETF Applications Await SEC Verdict
A growing number of asset managers—including Grayscale, Bitwise, 21Shares, CoinShares, and Canary Capital—have submitted proposals for XRP-based spot ETFs. Grayscale’s application is under close watch, with a pivotal SEC decision expected by May 22.
Although XRP lacks a robust U.S. futures market—a factor that helped Bitcoin secure spot ETF approval—its strong offshore trading activity and rising onshore presence add to its appeal. In contrast, Solana, once a promising candidate, has seen its U.S. market share fall from over 25% in 2022 to just 16% today.
Still, market sentiment remains mixed. Deribit, a leading options platform, indicates a bearish tilt for XRP heading into its April 18 options expiration—a sign that some investors remain cautious despite the positive momentum.
### A Pivotal Moment for Altcoin Legitimacy
If approved, an XRP spot ETF would represent a historic breakthrough for altcoin investing in the United States. Such a move would not only enhance XRP’s institutional appeal but also signal broader regulatory acceptance of digital assets beyond Bitcoin and Ethereum.