Why Trump’s presidency could lead to the launch of more crypto ETFs

January 15, 2025 12:44 PM PST | By Invezz
 Why Trump’s presidency could lead to the launch of more crypto ETFs
Image source: Invezz

As spot Bitcoin exchange-traded funds (ETFs) mark their first anniversary and Ethereum ETFs reach the six-month milestone, the cryptocurrency market is gearing up for a potential wave of new offerings.

With pro-crypto Donald Trump set to assume the presidency, market participants anticipate a friendlier regulatory environment that could pave the way for additional cryptocurrency ETFs.

Trump’s public endorsement of Bitcoin has already had a noticeable impact.

According to Nicholas Elward, head of institutional product and ETFs at Natixis Investment Managers, Trump’s stance has bolstered confidence in crypto investments.

“As a result, all signs point toward more positive developments for cryptocurrency ETFs in 2025,” Elward wrote in a note.

This optimism extends to spot ETFs—funds that hold actual cryptocurrencies rather than futures.

Asset managers such as 21Shares, Bitwise, WisdomTree, and Canary Capital have filed with the Securities and Exchange Commission (SEC) to launch ETFs tied to popular digital assets like XRP, Solana, Hedera, and Litecoin.

New SEC chair Atkins expected to make it easier for ETFs to gain approval

The SEC’s approach to crypto regulation has been a significant barrier to ETF approvals.

However, with SEC Chair Gary Gensler stepping down on Inauguration Day, analysts expect a shift in tone.

Trump’s nominee for the role, Paul Atkins, has criticized the SEC’s strict stance on digital assets.

This change could ease the path for crypto ETFs to gain approval.

Despite the optimism, regulatory challenges remain. Dom Harz, co-founder of blockchain network firm BOB, told Barron’s “The momentum we’re seeing with Bitcoin and Ethereum ETFs is just the tip of the iceberg.”

For Harz, “there are regulatory hurdles to overcome” before XRP and Solana ETFs are approved.

But “we will see increased movement towards single-asset ETFs across the board in 2025, especially for well-known tokens with strong brands,” he said.

Bitcoin and Ethereum ETFs maintain dominance

While there is excitement about new ETFs, Bitcoin and Ethereum remain the cornerstones of the market.

Bitcoin funds, according to JPMorgan analysts, have more than $100 billion in assets while Ethereum ETFs have $12 billion.

The iShares Bitcoin Trust leads the pack with over $45 billion in assets, and the Grayscale Ethereum Trust dominates the Ethereum ETF space with $4.6 billion.

In contrast, analysts estimate that Solana ETFs may attract only $3 billion to $6 billion in net new assets while XRP funds may get only $4 billion to $8 billion in investments.

JP Morgan analysts said,

We don’t see a next wave of cryptocurrency [ETF] launches as being meaningful for the cryptoecosystem given much smaller market capitalization of other tokens and far lower investor interest.

Harz acknowledged the disparity, noting that Bitcoin and Ethereum have established themselves as dominant ecosystems.

Still, crypto ETFs present a valuable entry point for novice investors, providing exposure to volatile assets without requiring direct ownership.

Opportunities for institutional winners

The evolving crypto ETF landscape is poised to benefit major market players.

Firms like Coinbase, BlackRock, and market maker Virtu have already profited from Bitcoin and Ethereum ETFs and are likely to see further gains if new ETFs are approved.

While demand for second-tier tokens may be more limited, the combination of a pro-crypto administration and a potentially less restrictive SEC has created a cautiously optimistic outlook for 2025.

Bitcoin and Ethereum will likely retain their dominance, but the market is ready for diversification, with institutional players well-positioned to capitalize on the next wave of crypto ETFs.

The post Why Trump's presidency could lead to the launch of more crypto ETFs appeared first on Invezz


Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations, and video (Content) is a service of Kalkine Media LLC., having Delaware File No. 4697309 (“Kalkine Media, we or us”) and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media.
The content published on Kalkine Media also includes feeds sourced from third-party providers. Kalkine does not assert any ownership rights over the content provided by these third-party sources. The inclusion of such feeds on the Website is for informational purposes only. Kalkine does not guarantee the accuracy, completeness, or reliability of the content obtained from third-party feeds. Furthermore, Kalkine Media shall not be held liable for any errors, omissions, or inaccuracies in the content obtained from third-party feeds, nor for any damages or losses arising from the use of such content. Some of the images/music that may be used on this website are copyrighted to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures/music displayed/used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it, as necessary.
This disclaimer is subject to change without notice. Users are advised to review this disclaimer periodically for any updates or modifications.


Sponsored Articles


Investing Ideas

Previous Next