Summary of Key Developments
- •The XRPC ETF experienced an inflow of $245 million on its debut trading day.
- •The XRPC ETF surpassed Solana and Bitcoin ETFs in terms of trading volume on its first day.
- •Despite market price declines, institutional interest in altcoins remains robust.
XRP ETFs have attracted significant attention, even as the broader cryptocurrency market experiences a downturn. While ongoing volatility has impacted prices, both the XRPC ETF and Solana ETFs have recorded substantial inflows, indicating a persistent investor interest in these digital assets.
The XRPC ETF, launched by Canary Capital, achieved a historic inflow of $245 million on its first day of trading on the Nasdaq. This performance exceeds that of recent Solana ETF products and several established Bitcoin ETFs. Canary Capital, under the leadership of CEO Steven McClurg, has a notable track record in digital asset management, stemming from his prior roles at Valkyrie Funds and other cryptocurrency ETF initiatives.
First Day Performance of the XRP ETF
On its inaugural trading day, the XRPC ETF registered a trading volume of $59 million, as reported by Eric Balchunas, Senior ETF Analyst at Bloomberg. Balchunas commented, "Congrats to XRPC for [$59m] in Day One volume, the most of any ETF launched this year (out of 900)." This trading volume slightly outperformed the Bitwise Solana ETF, which recorded $57 million.
“XRP demand could match or surpass interest in Solana ETFs.”
Steven McClurg
Both ETFs have emerged as leading performers among the new ETFs launched this year. The consistent trading volumes suggest that institutional interest remains strong, despite prevailing market turbulence. It is worth noting that the Bitwise Solana ETF (BSOL) accumulated $357.8 million in inflows within the two weeks following its October launch, including $12 million on November 14 alone.
Market Reactions Despite High Inflows
Both XRP and Solana experienced notable price declines concurrently with the successful ETF launches. XRP saw a decrease of 8%, trading at $2.28, while Solana dropped approximately 8% to $143.56. In contrast, Bitcoin ETFs experienced significant outflows, with BlackRock’s IBIT recording $257 million in outflows on the same day. Ethereum also mirrored these trends, suggesting a potential shift in investor preference towards altcoins.
Analysts have observed sharp increases in on-chain activities for XRP. Over 157.9 million tokens were liquidated rapidly during sell-offs. Furthermore, the addition of 21,000 new wallets within a 48-hour period indicates a surge in on-chain momentum, even in the face of price weaknesses.
Impact of Institutional Interest on Altcoins
Significant movements within institutional circles have had a considerable impact on XRP, Solana's native asset SOL, Bitcoin (BTC), and Ethereum (ETH). The strong performance of altcoin ETFs underscores a sustained interest from institutional investors, even during a broader market downturn.
Regulatory frameworks for these ETF launches are supported by company filings and SEC registrations, including the Form 8-A for Nasdaq listing. This SEC certification is crucial as these altcoin ETFs continue to gain traction.