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The ongoing shutdown of the United States government has resulted in significant delays in the approval of various cryptocurrency investment products, notably including the XRP Exchange-Traded Funds (ETFs). Investors are keenly awaiting institutional access to this highly debated and popular digital asset. Recent insights from industry insiders offer new information on the revised timelines, procedural changes, and potential outcomes once the regulatory hurdles are lifted.
Delays in XRP ETF Approval Due to US Government Shutdown
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Former Fox Business journalist Eleanor Terrett has shared important updates on the evolving timeline for the approval of XRP ETFs. In a recent post on social media platform X, she disclosed that Canary Funds has updated its S-1 registration for its XRP Spot ETF, removing the delaying amendment that typically grants the US Securities and Exchange Commission (SEC) control over the timing of such filings.
This procedural shift by Canary Funds sets the stage for a possible automatic launch date of November 13, contingent on NASDAQ’s approval of the accompanying 8-A filing. However, the timeline remains unpredictable due to the ongoing government shutdown.
Should the US Federal Government resume operations soon, allowing the SEC to function normally, Terrett notes that the approval and subsequent launch of XRP ETFs could progress rapidly. However, additional reviews by SEC staff may still lead to further delays.
SEC Chair Paul Atkins has expressed support for companies utilizing the auto-effective process to introduce new financial products to the market. Although he did not specifically mention ETFs, he commended firms like MapLight for successfully going public during the government shutdown through the statutory 20-day waiting mechanism. This process was also employed by Bitwise and Canary for launching their recent Solana, Hedera, and Litecoin ETFs.
This approach, originally crafted by the US Congress, is designed to keep capital markets active during administrative downtimes. Crypto asset managers are now leveraging it to launch their XRP ETFs and other crypto Exchange-Traded Products (ETPs) without enduring prolonged regulatory delays. Terrett clarified in a follow-up discussion that previous October deadlines for XRP ETF approval no longer apply, as the SEC’s new generic listing standards have rendered the older 19b-4 filing process obsolete.
Anticipated Liquidity Surge Following XRP ETF Approval
Crypto analyst ‘DigitalG’ on X has provided further insights into the potential market impact of the pending ETF approvals. He noted that the US government shutdown has created a backlog of XRP ETF filings awaiting clearance. Once the SEC reopens and addresses this backlog, the analyst predicts that multiple approvals could swiftly follow.
This rapid approval process could significantly enhance institutional access and demand for XRP, potentially triggering a substantial surge in market liquidity. DigitalG also anticipates that this influx of institutional participation could lead to notable price movements. He explains that the expected wave of ETF approvals might offer an ideal opportunity to cover large short positions currently present in the market.
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