Despite rumors that the SEC approved a spot XRP ETF, this is inaccurate. The only new development concerns ProShares’ Leveraged and Short XRP Futures ETFs, which will begin trading on April 30.
It’s unclear how much these false claims impacted XRP’s price today, but they caused a lot of commotion. Fake crypto news has been taking off lately, and this could negatively impact investor confidence.
A US Spot XRP ETF Is Not Here Yet
The crypto industry is full of enthusiasm for an XRP ETF, especially since one began trading in Brazil last week.
However, there’s no shortage of overeager people who can spark and circulate optimistic rumors. ProShares’ new Futures ETF did indeed win approval, but this has no bearing on a Spot ETF:
Bitcoin, the first crypto-centric ETF category, achieved a futures ETF before a spot one. In some ways, the SEC’s approval of an XRP Futures ETF is a positive sign.
The Commission has an impending deadline to reject or confirm these proposals, and experts believe that approval is highly likely. Unfortunately, that does not change the reality today.
XRP’s price has been zig-zagging in the last 24 hours, with notable pullbacks. It isn’t fair to claim that ETF hype is the source of all XRP moves; several circumstances may be contributing to the situation.
Still, rumors have recently had a demonstrable impact on crypto markets, even when they’re completely false. These garbled claims may have affected XRP.
Confusion doesn’t help build a stable industry. Even if false ETF rumors temporarily boost XRP’s performance, that’s not a sign of long-term ecosystem health. Misinformation can significantly damage public trust, especially among retail investors.
For example, Eleanor Terrett commented on these rumors, claiming she’s “getting really sick of all the rude keyboard warriors in this community.”
Apparently, she received online hostility for trying to clarify the news decision despite being both correct and a respected source of pro-crypto journalistic coverage.
Spot ETF vs Futures ETF – What are the Differences?
Spot ETFs directly hold XRP tokens, providing investors with exposure to the actual cryptocurrency. These ETFs aim to mirror the real-time market price of XRP. So, there’s a straightforward correlation between the fund’s value and the token’s spot price.
As of now, spot XRP ETFs are not approved in the US. Applications from firms like Grayscale and Bitwise are under SEC review.
Meanwhile, leveraged futures ETFs do not hold XRP directly. Instead, they invest in futures contracts that speculate on the future price of XRP.
Due to daily resetting of leverage, these ETFs can experience significant volatility and may not be suitable for long-term holding.
Even if these XRP ETF rumors came from a genuine misunderstanding, they’re still dangerous. In the future, the community must be careful to vet its sources and act in good faith to maintain public confidence.
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