BlackRock, the $12.53 trillion asset manager, has continued to resist filing for a spot XRP ETF. In a statement earlier this month, the company insisted that it had no plans to file for one any time soon. Here are some of the reasons why it makes sense for the company to file for a Ripple ETF.
BlackRock Has Been Successful in Crypto ETF
One reason why BlackRock should consider an XRP ETF is that it has become the most successful company in the industry. The iShares Bitcoin Trust (IBIT) ETF has had cumulative inflows worth $58 billion and now has $84 billion in assets.
Similarly, the iShares Ethereum Trust (ETHA) has had $12 billion in inflows and now has $14.7 billion in assets. Its asset growth happened even though its funds are not the cheapest, a sign that investors love its brand.
An iShares XRP Trust would also be successful, with JPMorgan predicting that spot XRP ETFs would have at least $8 billion in inflows in the first year.
There are signs that the ETF would be popular, as the recently launched XXRP and UXRP ETFs have added $470 million and $120 million in assets in a few months’ time.
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An iShares XRP ETF Would be Highly Profitable
The other reason why a BlackRock XRP makes sense is that it would be highly profitable. Data show that IBIT is the company’s most profitable fund due to its expense ratio of 0.25%.
If the AUM reaches $100 billion, it means that the fund will be making $250 million a year, higher than the $195 million that the iShares Core S&P 500 ETF (IVV) makes.
BlackRock’s ETHE ETF has over $12 billion in assets, meaning that it will start making over $30 million in annual fees.
XRP is a Utility Token and is Growing
Meanwhile, like Ethereum, XRP is a top utility coin since it is the native token for the XRP Ledger, a layer-1 network that is seeing strong growth.
XRP Ledger powers several dApps and is used by financial institutions to simplify the movement of payments globally. It also powers the recently launched Ripple USD (RLUSD), which has attained over $666 million in market capitalization.
XRP is Huge and Highly Liquid
Additionally, XRP is a large cryptocurrency with a market capitalization of over $176 billion, making it only smaller than Bitcoin and Ethereum.
XRP is also one of the most actively traded tokens in the crypto industry, with over $7.7 billion in daily volume. This liquidity means that it is easy for users to buy and sell the coin and that there is robust demand in the crypto community.
There are other reasons why BlackRock should file for an XRP ETF, including the fact that its legal issues with the Securities and Exchange Commission have ended and that a court has ruled that XRP is not a security.
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