Daily Crypto Signals: XRP Surges 10% on ETF Launches, Solana Struggles Amid Bearish Derivatives Pressure
XRP rallied over 10% following the launch of multiple exchange-traded funds from Franklin Templeton, Grayscale, Bitwise, and Canary Capital
Quick overview
- XRP surged over 10% following the launch of multiple exchange-traded funds, marking a significant milestone after years of SEC litigation.
- Solana is facing challenges with negative funding rates and declining network fees, trading 30% below its recent highs despite leading in active blockchain addresses.
- The crypto market experienced significant outflows, with nearly $5 billion leaving exchange-traded products in the past month, although there were signs of stability with $258 million in inflows recently.
- Japan's Financial Services Agency is preparing to implement new regulations requiring bitcoin exchanges to maintain liability reserves for customer funds.
XRP XRP/USD rallied over 10% following the launch of multiple exchange-traded funds from Franklin Templeton, Grayscale, Bitwise, and Canary Capital, marking a significant milestone nearly five years after SEC litigation began. Meanwhile, Solana SOL/USD remains under pressure with negative funding rates and declining network fees despite maintaining its lead in active blockchain addresses, trading 30% below its 30-day high.
Crypto Market Developments
The crypto market is still going through rough times, with investment products losing money and regulatory changes bringing some good news. Last week, $1.94 billion left crypto exchange-traded products, pushing the total for the last four weeks to almost $5 billion. This is the third-largest outflow on record, behind only the March tariff-driven selloff and the February 2018 dip.
But at the end of the week, there were some tentative signs of stability, with $258 million coming in during the last few days of trade, ending a seven-day sequence of redemptions. The diverse digital assets’ fates were clear when XRP investment products went against the trend and brought in $89.3 million, even though the token fell 6.9%. On the other hand, Solana ETPs lost $156 million.
Reports from Nikkei say that Japan’s Financial Services Agency is getting ready to make bitcoin exchanges keep liability reserves for customer funds. The goal of the move is to make it easier for people who are harmed by security breaches or other unexpected events to get paid quickly. The Financial System Council is set to make recommendations after a meeting on Wednesday. Japan has over 12 million registered crypto accounts among its 123 million people, so this new rule is coming at a good time.
The New York Stock Exchange subsidiary NYSE Arca gave the last approval needed for Grayscale’s Dogecoin and XRP exchange-traded funds to start trading on Monday. A Chainlink-linked ETF is scheduled to follow soon after. These releases are the most recent speculative cryptocurrency investment vehicles that asset managers have brought to market in the past several weeks.
XRP Rallies 10%+ on ETF Debut
XRP saw a lot of action on Monday when Franklin Templeton debuted its XRP ETF on NYSE Arca under the ticker XRPZ. This was the same day that Grayscale, Bitwise Asset Management, and Canary Capital all launched their own ETFs. The XRP Ledger’s native asset, an open-source blockchain created by Ripple, rose 8.25% in 24 hours as many regulated investment vehicles made it easy for institutional investors to get to the cryptocurrency.
Franklin Templeton’s head of ETF product and capital markets said that XRPZ gives investors a regulated means to get to a digital asset that is a key part of the global settlement system through the transparency and monitoring of an ETF structure. At the time of publication, Franklin Templeton’s offering had not yet released first-day inflow data. However, NYSE Arca reported that 768,692 shares were traded, and Bitwise CEO Hunter Horsley said that his company’s XRP ETF had received over $118 million in inflows the week before.
The ETFs came out over five years after the Securities and Exchange Commission sued Ripple and its leaders. When the SEC withdrew its investigation in March under new leadership and a new administration, the regulatory cloud finally lifted. The case officially ended in August with a $125 million settlement. Franklin Templeton’s XRP offering needed SEC approval to start trading on NYSE Arca. This was a big change in how regulators felt about the cryptocurrency, which had been in legal limbo for years.
Solana Faces Headwinds Despite Network Leadership
Solana’s native token couldn’t go back to $140 on Monday, even if it had made up some of its previous losses. This was because of low funding rates in perpetual futures and a drop in onchain activity. SOL is still down 30% in the last 30 days, which is much worse than the rest of the altcoin market. Traders are unsure if any potential rising trend will last.
Derivatives markets show that SOL is still under bearish pressure. Since Friday, perpetual futures financing rates have been negative, which means that traders are paying extra to keep short positions in the hope that prices will keep going down. Over the past 30 days, the total open interest in SOL futures has declined by 27%, which means that there is less demand for leveraged exposure. The premium on SOL monthly futures compared to spot prices has dropped to 0%, which is in line with very bearish conditions and is a big change from the 5–10% range that is common in neutral markets.
Network metrics give a mixed view on Solana’s future. The total value locked on the Solana network fell to $10.5 billion on Monday, down 20% from a month earlier. Weekly fees, which are used to evaluate blockchain earnings, were at their lowest level since May. This lack of costs helps explain why SOL has not done as well as its competitors; for example, Ethereum’s weekly fees only went down by 5% during the same time period.
But Solana is still clearly in the lead when it comes to blockchain activity measures. Nansen data shows that the network is considerably ahead of the second-place BNB Chain in both active addresses and transaction count. More encouragingly, Solana’s activity went up by 13%, while its biggest competitor Ethereum’s activity went down by 15%. SOL has gone up 14% since hitting a low of $121.50 on Friday, but its future is still unclear. There is still a chance of a short squeeze toward $160, but traders would need to be much more confident and the derivatives market would need to get better before the upward momentum lasts.
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