Main Points :
- Experts suggest that under Kamala Harris, the approval of non-Bitcoin and Ethereum cryptocurrency ETFs is unlikely.
- Ripple’s XRP and Solana ETFs have been submitted for approval, but their future largely depends on the outcome of the U.S. presidential election.
- If Donald Trump wins the election, the chances of broader cryptocurrency ETF approvals may significantly increase.
- Harris’s administration is expected to take a cautious approach, following the Biden administration’s generally adversarial stance towards cryptocurrencies.
- Trump has positioned himself as favorable to the crypto community, gaining substantial support due to his pro-crypto stance.
The Current Landscape of Cryptocurrency ETFs
The approval of Bitcoin and Ethereum spot ETFs marked a major victory for the cryptocurrency industry. These approvals came after years of lobbying by multiple financial institutions, and firms like Grayscale even had to take legal action against the U.S. Securities and Exchange Commission (SEC) to secure their approval. With billions of dollars flowing into these ETFs, the market is now buzzing with anticipation of what comes next. Ripple’s XRP and Solana (SOL) are the latest contenders in the ETF space, but experts believe their future largely hinges on the outcome of the upcoming U.S. presidential election.
Kamala Harris’s Potential Impact on Cryptocurrency ETFs
According to ETF experts, if Kamala Harris wins the 2024 U.S. presidential election, the likelihood of approving cryptocurrency ETFs beyond Bitcoin and Ethereum will significantly decrease. Harris is expected to continue the generally cautious approach of the current Biden administration, which has not been favorable towards cryptocurrencies.
Eric Balchunas, a senior ETF analyst at Bloomberg Intelligence, believes that “if Harris wins, regardless of the issuers, these non-Bitcoin and Ethereum ETFs will likely not see approval.” This sentiment reflects the current administration’s overall wariness towards cryptocurrencies, which is likely to continue under Harris.
Ripple’s XRP and Solana ETFs: Waiting for Approval
Several major companies, including Ripple and those involved with Solana, have already filed for ETF approval. However, these applications are expected to remain stagnant under Harris’s potential administration. Bloomberg’s Eric Balchunas points out that Harris’s stance suggests little progress will be made on these applications in the near future.
At present, the Biden administration’s approach to crypto has been described as “adversarial,” a sentiment that is likely to persist under Harris. Nate Geraci, president of the ETF Store, agrees that the approval of any new cryptocurrency ETFs, particularly for assets beyond Bitcoin and Ethereum, seems highly improbable under Harris, at least in the short term.
Trump’s Favorable Stance on Cryptocurrencies
On the other hand, Donald Trump has taken a surprisingly favorable stance towards cryptocurrencies. Trump’s campaign has actively embraced the crypto community, attending high-profile Bitcoin conferences and supporting decentralized finance (DeFi) initiatives. If Trump wins the election, analysts expect the possibility of Ripple’s XRP and Solana ETFs being approved to increase dramatically.
Polymarket, a major prediction market, has shown a significant increase in Trump’s election victory odds, which currently sit at 62.4%. If Trump were to return to office, his administration could open the door to wider approval of cryptocurrency ETFs, something that many in the industry are watching closely.
The Role of Major Players Like BlackRock
BlackRock’s involvement in the cryptocurrency ETF space has been a game-changer. The asset management giant’s entry into the market increased the likelihood of approval for Bitcoin and Ethereum ETFs. However, when it comes to non-Bitcoin and Ethereum ETFs, even BlackRock’s influence may not be enough to sway Harris’s administration.
While BlackRock has made significant strides in the Bitcoin and Ethereum ETF market, there is no guarantee that the company would be able to push forward additional cryptocurrency ETFs under Harris. As Nate Geraci explains, the current administration’s cautious regulatory approach toward cryptocurrencies is unlikely to change, even with major institutional backing.
Harris’s Limited Engagement with the Crypto Sector
Unlike Trump, Kamala Harris has maintained a relatively low profile on the subject of cryptocurrencies. Although her campaign has recently unveiled plans to establish a regulatory framework for digital assets, this has primarily been aimed at protecting investors, particularly within the Black community. Harris’s focus has not been on promoting the growth or adoption of cryptocurrencies, but rather on regulation and oversight.
This cautious stance further reinforces the belief that non-Bitcoin and Ethereum cryptocurrency ETFs, such as those for XRP and Solana, will not see progress under a Harris administration. The details of how Harris plans to regulate the crypto space remain vague, but her campaign has not provided much in the way of support for broader ETF approvals.
The Future of Cryptocurrency ETFs in a Political Context
The future of cryptocurrency ETFs beyond Bitcoin and Ethereum is now largely dependent on the outcome of the U.S. presidential election. While Kamala Harris is expected to maintain a cautious approach, likely stalling the approval of new cryptocurrency ETFs, a victory for Donald Trump could usher in a more favorable environment for broader ETF approval.
Ripple’s XRP and Solana ETFs are at the forefront of the next wave of potential cryptocurrency ETFs, but their fate is tied to the political landscape. If Harris wins, the focus will likely remain on regulation and investor protection, rather than expanding the ETF market. Conversely, a Trump victory could mark a turning point for the crypto industry, with broader ETF approvals and a more open regulatory environment on the horizon.
In either scenario, the outcome of the 2024 election will play a critical role in shaping the future of cryptocurrency ETFs in the United States.
