While the XRP price itself is under pressure, the cryptocurrency is making a remarkable impression on Wall Street. The American XRP stock exchange funds are achieving unexpectedly rapid success. According to crypto entrepreneur Sui Chung, the explanation is partly due to the fame of the project among the big boys.
Familiarity and performance make XRP attractive
According to Sui Chung, CEO of CF Benchmarks, the rapid growth of XRP spot Exchange-Traded Funds (ETFs) is mainly due to the currency’s recognizability among institutional investors.
In an interview with CNBC, he explains that traditional parties have been following XRP for years. This makes the cryptocurrency feel less new or risky compared to many other altcoins.
Chung also points out that XRP has been around for a while. “XRP has a long history and therefore a certain trust factor,” said the CEO. Since 2022, XRP has even risen more than 400 percent, despite the recent price drops.
According to the CEO, the performance is attracting capital from investors looking for alternatives, especially now that outflows are taking place from both the Bitcoin (BTC) and Ethereum (ETH) funds.
How does an XRP spot fund work?
An XRP spot ETF works like a mutual fund that holds real XRP coins. Investors do not buy XRP itself, but shares in a fund. The manager purchases XRP in the background, so that the value of the fund follows the price of XRP.
With a net inflow, more money flows into the fund than out, which means that investors buy more. With a net outflow the reverse is the case.
XRP funds break through the $1 billion mark
The interest in XRP funds has now grown into a striking milestone. According to SoSoValue data, total net inflows have reached $1.06 billion. Yesterday, $30.41 million in new capital was added.
This means that the XRP funds are doing better than many established competitors. The American Bitcoin ETFs recorded an outflow of $161.3 million yesterday, while Ethereum funds have now only seen capital losses for six days in a row.
Yesterday alone, $96.6 million flowed out of ETH funds. In total, the outflow over six days amounts to almost $630 million.
XRP ETFs, on the other hand, have shown net inflows every trading day since their launch on November 14.
The first XRP fund on Wall Street was launched by Canary Capital. Big names such as Grayscale, Franklin Templeton, Bitwise and 21Shares have also joined. In total, there are now five active funds that track XRP.
Source: https://newsbit.nl/xrps-bekendheid-is-de-drijvende-kracht-achter-het-succes-op-wall-street/
