XRP Price Volatility Amid ETF Speculation: What’s Next for Investors?
XRP, the digital asset associated with Ripple Labs, has seen significant price fluctuations recently, driven by speculation over the potential approval of an exchange-traded fund (ETF) by the U.S. Securities and Exchange Commission (SEC). As of February 18, 2025, XRP is trading at $2.58, reflecting a 2.64% decline from the previous close. Despite this short-term dip, the token has gained approximately 10% over the past week, fueled by growing optimism around ETF approvals.
SEC’s Acknowledgment of XRP ETF Applications
The recent surge in XRP’s price is largely attributed to the SEC’s formal acknowledgment of ETF applications that seek to track the cryptocurrency’s performance. Notably, Grayscale Investments has submitted an application for a spot XRP ETF, which the SEC has officially taken under review. This step initiates a 240-day evaluation period, during which the regulatory body will analyze the proposal before making a final decision.
The approval of an XRP ETF could provide institutional investors with a regulated and compliant avenue to gain exposure to the cryptocurrency, potentially leading to higher demand and increased market liquidity. Similar ETF approvals for Bitcoin and Ethereum in the past have resulted in significant capital inflows into those assets.
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Market Speculation and Betting Trends
As anticipation builds, prediction markets such as Polymarket have seen increased betting activity on the likelihood of XRP ETF approval. As of mid-February 2025, the probability of an XRP ETF being approved by the end of the year has risen to approximately 81%, signaling growing investor confidence in a favorable SEC ruling.
How ETF Approval Could Impact XRP’s Price
Historically, ETF approvals have triggered major rallies in cryptocurrency prices. When the first Bitcoin ETFs were approved, Bitcoin’s price surged more than 40% in the following weeks. A similar effect could occur for XRP, as institutional investors would be able to allocate funds to the asset via traditional brokerage accounts.
However, there are also concerns that XRP’s price may remain volatile, as markets often overreact to speculative news. If the SEC delays its decision or rejects the ETF application, XRP could face a sharp correction. Investors are advised to approach with caution and monitor regulatory developments closely.
Regulatory Landscape and Future Outlook
The SEC’s consideration of multiple cryptocurrency ETF applications, including XRP, suggests a shifting regulatory environment under the current administration. With the SEC previously approving spot Bitcoin ETFs, many analysts believe other major cryptocurrencies such as XRP, Solana, and Dogecoin could be next in line for approval.
For XRP holders, the coming months could be pivotal. If an ETF is approved, it could solidify XRP’s position as a mainstream asset and drive further adoption among traditional investors. Conversely, delays or rejections could result in short-term volatility, making risk management crucial for traders and long-term investors alike.
