Following the launch of the historic XRP Spot ETFs, the community has been buzzing with excitement, triggering notable success for the funds over the next few days. As the exchange funds continue to attract significant inflows, a crypto expert has outlined the development that is unfolding behind the initiative.
What’s Happening Behind The XRP Spot ETFs
The Spot XRP ETFs are seeing robust growth, but what is happening behind the scenes is quite interesting and demands attention. Pumpius, a crypto expert and investor, has uncovered a subtle play among institutions that is not being shared with the general crowd.
According to the expert, ETF fund managers are legally forbidden from purchasing XRP directly from payment firm Ripple or escrow. This is due to the court’s injunction that every single ETF must acquire the altcoin on the open market only, breaking the concept of shortcuts, backdoor deals, and wholesale buying.
Pumpius has declared this underlying trend at the institutional level to be the most bullish step for the altcoin. His reason hinges on the fact that Ripple will only release what is absolutely necessary from the monthly escrow holdings.
Furthermore, the payment firm will avoid causing taxable events this way by keeping the escrow untouched. Such a move would imply that Ripple is drip-feeding just enough liquidity to avoid dislocation while ETFs are actively absorbing circulating supply.
The expert considers this pattern the calm before a structural supply shock, and not a sign of stagnation. When the shift happens, it will be seen as a balancing act, a pressure build-up, and a loading phase.
In the meantime, fund managers are already in discussion with Ripple, which means timing coordination is currently ongoing. At the same time, the expert has highlighted that supply dynamics are now being designed in real time.
Once the early balance period concludes and ETF demand continues to rise while escrow is strictly regulated, XRP will not move at a slow pace. Instead, the expert predicts that the altcoin will experience substantial movement, breaking upside resistance levels with violence.
A High Demand For The Exchange Funds
Spot XRP ETFs have become a serious mode of investment in the landscape since their launch. Franklin Templeton recently stunned the market by introducing the Franklin XRP ETF on NYSE Arca and referring to the token as “fundamental to the global settlement system.”
Other major firms such as Bitwise, Grayscale, and Canary Capital have all rolled out their own ETFs, which attracted millions in inflows from their first day. With the robust adoption and interest in the funds, the message is clear that the demand for regulated XRP exposure is bigger than anticipated.
Despite the significant demand, BlackRock, the world’s largest asset manager, has yet to jump into the funds, stating that customer demand is still primarily centered on Bitcoin and Ethereum for now. Furthermore, they believe that regulatory clarity is still not entirely certain despite repeated victories over the US SEC.
However, if the company eventually launches its own fund, it would spur billions of capital and new institutional money. Considering its status in the finance sector, “a BlackRock ETF would be the ultimate stamp of approval.”
Featured image from Adobe Stock, chart from Tradingview.com
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