(Bloomberg) -- After being embroiled in a years-long dispute with the US Securities and Exchange Commission over what constitutes a security, Ripple Labs Inc. Chief Executive Officer Brad Garlinghouse says it’s “just inevitable” that the company’s XRP cryptocurrency will be offered through an exchange-traded fund.
Since funds holding Bitcoin were first approved in January, “$17 billion has flowed into the fastest growing ETF in history,” Garlinghouse said during a Bloomberg Television interview Wednesday. “It clearly demonstrates that there’s demand from institutions and retail to access this asset class.”
Earlier this month, Bitwise Asset Management Inc. became the first firm to file paperwork with the SEC for an ETF tracking XRP, the world’s seventh-largest digital token. Shortly thereafter, Canary Capital Group, a digital asset-focused investment firm founded in September, followed suite to file for the launch of the Canary XRP ETF.
“We clearly are seeing that ETFs have been popular,” Garlinghouse said. “The United States SEC was dragged, kicking, and screaming to approve the Bitcoin ETF in January.”
Ripple Labs was sued in 2020 by the SEC, which claimed the San Francisco-based company broke the law when it raised money by selling the digital token without registering it as a security. Last year, US District Judge Analisa Torres found XRP was covered by securities law only when sold to institutional investors, a ruling hailed as a major victory for the industry. The SEC has appealed the ruling, seeking to reverse elements of the summary judgment.
The demand for crypto ETFs is part of a trend of more and more institutionalized participation in the crypto industry, according to Garlinghouse. “It creates upwards pressure on the prices for many different cryptos, including XRP.”
--With assistance from Tim Stenovec.
©2024 Bloomberg L.P.
