SEC ‘purgatorial state’ disrupts exchanges SOL and XRP securities attributes

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The new leadership under Trump still needs to decide the securities attributes of assets such as SOL and XRP. This is key because it’s making it difficult for exchanges to place crypto coins. The crypto industry is still waiting for the new chairman, Paul Atkins, to confirm his appointment.  

The SEC has been delaying court proceedings and requests from crypto companies.  Even in the final days of the former chairman SEC Gary Gensler, the SEC went ahead with Ripple appeal.

According to Bitwise’s Katherine Dowling, the SEC appears to be waiting for a directive from up high on how to handle the litigation.

The reason this securities decision delay cannot be ignored is because XRP had requested for the approval of an XRP ETF. However, the ETF is expected to take longer. To that end, polymarket users predict an 82% chance that an XRP ETF will be approved in 2025.

Katherine Dowling shared her thoughts that she expects the Bitcoin and Ethereum combination ETF to be approved quickly. Other crypto asset ETFs will still take longer to approve. In addition, she said that since the SEC does not regard DOGE as a security, the DOGE ETF may be more easily approved.

What is the future of SOL & XRP?

SOL and XRP have been considered by several exchanges so far. Bitwise submitted an S-1/A registration statement to the SEC for an XRP ETF.  The filing was an indication that Bitwise plans to offer clients a new way to invest in XRP using a standard financial product. 

If approved, the ETF would allow investors to trade shares representing XRP on major stock exchanges. This would increase the crypto’s accessibility and liquidity. Although the decision was delayed, the community is still optimistic that  XRP is on the run.

In addition, the Chicago Mercantile Exchange (CME) Group is considering the possibility of launching XRP and SOL futures products. The derivatives market started offering bitcoin futures contracts in December 2017. It continued with ether futures in early 2021. 

Recently on social media, pictures appeared showing that XRP and SOL futures will be available this month. Their page showed a press time set for a pre-launch on Feb. 10. Bloomberg ETF expert James Seyffart warned that the page might be fake. He also said that futures contracts for SOL and XRP are reasonable and to be expected.

Still, Alex Thorn, the research head at Galaxy Digital, later showed pictures showing that CME will provide futures and micro futures contracts for both assets. He revealed that all will be paid in cash. This means the SEC’s delay is costing both crypto coins major opportunities.

XRP price proves investors’ uncertainty

According to on-chain data, XRP has seen a 17% downtrend in the last 7 days. This proves that investors are still worried about the future of XRP. One thing is for sure, its short-term trends rely on how the SEC approaches its appeal and whether an XRP-spot ETF gets approved. 

The acting SEC Chair Mark Uyeda recently said, “The Commission’s war on crypto must end, including crypto enforcement actions solely based on a failure to register with no allegation of fraud or harm. President Trump and the American electorate have sent a clear message. Starting in 2025, the SEC’s role is to carry out that mandate.”

Mark Uyeda’s views on enforcement could affect how they handle the appeal. This means they might choose to drop it. If the SEC keeps appealing and delays or rejects spot ETF applications, XRP might fall below $2.

Ripple needs to submit its reply brief for the appeal by April 16. This gives the SEC enough time to review the case. However, if the SEC doesn’t speak up soon, XRP might become more unstable in the next few months.

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