XRP and Solana (SOL) are emerging as top contenders for spot ETF approval in the United States, fueled by their significant liquidity. Analysts from Kaiko shared insights in a recent report, indicating that the Ripple-associated token is likely to be the frontrunner to debut on the market ahead of other assets.
According to data from Kaiko Indices, both XRP and SOL demonstrate the deepest market depth within the top 1% across vetted exchanges. Since late 2024, XRP has outperformed SOL in terms of liquidity, even surpassing Cardano’s ADA by doubling its trading volume.
Unlike Bitcoin, which received spot ETF approval following Grayscale’s legal triumph illustrating the SEC’s inconsistent approach toward futures and spot markets, XRP presents a different scenario. The token does not possess a robust futures market, and its trading activities are predominantly offshore.
Notably, XRP’s market share in U.S. spot trading has risen to its highest levels since the SEC’s lawsuit in 2021 caused several exchange delistings. Conversely, SOL’s U.S. market share has waned, dropping to 16%, down from its 2022 high of 25% to 30%.
The recent introduction of a 2x XRP ETF by Teucrium has further enhanced XRP’s momentum. This new ETF mirrors European ETPs and swap agreements, aiming to deliver returns equivalent to double XRP’s daily performance. On its first day, the ETF garnered over $5 million in trading volume, marking it as the provider’s most successful launch to date.
As noted by Kaiko analysts, “This underlying market’s improving dynamics and the launch of a 2x XRP ETF last week position XRP ahead of other assets when it comes to approval.” They also suggest that certain tokens, such as Litecoin, which share similar consensus mechanisms with Bitcoin and resemble commodities, could also have viable paths toward approval.
However, despite XRP’s robust fundamentals, current options markets on Deribit indicate a degree of caution, with a bearish bias apparent in the implied volatility smile for April 18 expirations, suggesting a demand for downside protection among investors.
The SEC has acknowledged multiple XRP spot ETF applications, with Grayscale’s filing facing a crucial deadline on May 22. As the landscape evolves, the coming months will prove essential for XRP, SOL, and their potential for ETF acceptance.
