- XRP Spot ETF is growing in popularity and targeting the $5 billion threshold.
- 5% to 6% of XRP’s circulating supply could be allocated to spot ETF products.
- The XRP spot ETF currently has a cumulative total net inflow of $1.42 billion.
Grayscale’s Managing Director of Research, Zach Pandl, said the XRP spot ETF is growing in popularity among investors. According to him, the product is benefiting from diversification in crypto portfolios, with Bitcoin and Ethereum ETFs maintaining their unique trends.
The 5% to 6% Spot ETF Allocation Pattern
Speaking during a podcast, Pandl noted the percentage of assets held in Bitcoin and Ethereum ETFs as rough benchmarks. According to him, 5% to 6% of the monthly circulating supplies held in Bitcoin and Ethereum ETFs could serve as benchmarks for XRP ETFs in the short term.
Pandl stated that the XRP ETF is heading toward constituting between 5% and 6%, or higher, of the cryptocurrency’s total circulating supply amid increasing demand. For context, XRP ETFs saw massive demand last month and did not experience negative net daily inflow throughout May, according to SosoValue’s data.
Source: SosoValue
It is worth noting that the XRP spot ETF has a cumulative total net inflow of $1.42 billion at the time of writing. Meanwhile, the cryptocurrency’s total circulating supply is 69.97 billion XRP, corresponding to a market capitalization of approximately $75.5. Pandl’s 6% estimation of this value would be about $4.5 billion, which he predicts to be a short-term threshold in comparison to capital allocations to Bitcoin and Ethereum ETFs.
Related Article: XRP ETFs Draw $25.8M as Ripple Developments Lift Market Focus
XRP’s Impressive Adoption Story
Citing other major products that make up the XRP ecosystem, particularly the XRP futures, Pandl acknowledged a broader adoption story of Ripple’s technology. According to him, futures represent a critical element of virtually every developed financial asset and play a crucial part in crypto.
Although Pandl maintains a bullish posture for XRP, the cryptocurrency has experienced a bearish period this week. TradingView’s data show that XRP declined by more than 15.5% over the past five days, dropping to $1.14 on Thursday and almost retesting the yearly low established on February 5.
Analysts attribute the contrast between XRP’s fortunes and ecosystem developments to prevailing macroeconomic factors. Most of them believe the effect of the growing demand for products would reflect in XRP’s price after broader economic factors, such as the CLARITY Act and Middle East tensions, are resolved.
Related Article: XRP ETFs Attract $12.5M in Weekly Inflows as Bitcoin and Ethereum ETFs Bleed
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