The possibility of an 'explosion' in the XRP ETF market has increased with the passage of the CLARITY Act.

▲ XRP ETF / ChatGPT generated image ©

The spot XRP (Ripple) ETF market is once again drawing attention amidst expectations for the CLARITY Act, a US cryptocurrency market structure bill. While institutional funds continue to flow into major XRP ETF products like XRPI and XRPR, an analysis suggests that Goldman Sachs' large-scale exit remains a key variable.

According to investment specialized media TradingNews on May 20 (local time), Nasdaq-listed XRP ETF XRPI traded at $7.63, and Rex-Osprey XRP ETF XRPR traded at around $11.23 on that day. While the spot price of XRP has been in a box-bound trend around $1.37 for 105 days, the ETF market is maintaining upward pressure amid regulatory expectations.

The media pointed to trading volume as the biggest difference between XRPI and XRPR. The average daily trading volume of XRPI was approximately 192,430 shares, whereas XRPR only reached about 20,220 shares. Accordingly, it was analyzed that XRPI is advantageous for large-scale fund operations, while XRPR is more suitable for relatively small-scale tactical investments. Currently, at least seven XRP ETF products are operating in the US market, including Franklin Templeton XRP ETF (XRPZ), Canary Capital XRP ETF (XRPC), and Bitwise XRP ETF.

In particular, the XRP ETF market has seen a cumulative inflow of approximately $1.39 billion since its launch in November last year. This exceeds the cumulative inflow of about $1.12 billion into Solana ETFs during the same period. Recently, Franklin Templeton's XRPZ product has shown the strongest inflow of funds, and daily inflows have rapidly increased since the progress of the CLARITY Act, a US cryptocurrency market structure bill, the media reported.

However, institutional investor sentiment does not seem to have fully recovered. Goldman Sachs liquidated all of its XRP ETF positions, worth approximately $154 million, in the first quarter of this year, and also sold all Solana ETFs. In contrast, it maintained its Bitcoin ETF holdings. The media interpreted this as “a sign that institutional funds are being reorganized around Bitcoin.”

TradingNews identified the passage of the CLARITY Act and SBI Holdings' plan to launch an XRP ETF in Japan as the biggest variables moving forward. JPMorgan predicted a potential inflow of up to $8 billion in new funds into the XRP ETF market if the bill passes. The media analyzed that if XRP breaks $1.50 on a spot basis, XRPI could rise to $10-$10.50 and XRPR to $14.50-$15. Conversely, it added that if XRP falls below $1.30, the current bullish scenario could be invalidated.

*Disclaimer: This article is for investment reference only and is not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*