SEC Delays XRP-Spot ETF Reviews Raising Investor Concerns

SEC delays XRP-spot ETF reviews, raising investor concerns over approval timelines and market sentiment.

The XRP Price dipped 1% amid broader market gains, reflecting legal headwinds and ETF uncertainty.

Bitcoin rose as the GENIUS Act passed the Senate, boosting investor optimism on crypto legislation progress.

SEC Delay Raises Concerns Over XRP-ETF Prospects

SEC delays rattle XRP-ETF hopes on Tuesday, May 20, as the focus shifted to intermediate deadlines for XRP-spot ETFs. The SEC delayed its review of the Grayscale XRP Trust conversion to an ETF, raising concerns about the prospect of an XRP-spot ETF market.

SEC Delay Raises Concerns

Bloomberg Intelligence Analyst James Seyffart downplayed the delay, stating:

Risks in Derivatives Trading and XRP ETF Legal Developments

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However, the May 15 court ruling in the SEC vs. Ripple case sank expectations that the SEC would review XRP-spot ETF applications before their final October deadlines. Judge Analisa Torres rejected an SEC request for an indicative settlement ruling to lift the injunction on XRP institutional sales and reduce the $125 million penalty.

If Judge Torres rejects a second filing, Ripple may pursue its cross-appeal, forcing the SEC to progress its appeal against the Programmatic Sales of XRP ruling. An appeal withdrawal may be crucial for an XRP spot ETF approval.

21Shares XRP ETF, Bitwise XRP ETF, Canary Funds, and WisdomTree have intermediate deadlines this week. However, Seyffart expects the SEC to delay these reviews, stating:

XRP Price Outlook Amid Market Trends and Legal Developments

XRP declined 1% on Tuesday, May 20, following Monday’s 2.01%, closing at $2.3566. The token underperformed the broader market, which rose 0.82%, taking the total crypto market cap to $3.31 trillion.

XRP’s near-term price trajectory depends on US crypto legislation, upcoming settlement court filings, court rulings, and XRP spot ETF market-related news.

Technical support sits at $2.3. A break above the May 12 high of $2.6553 could signal a move toward $3.00, with the potential to reach the record high of $3.5505.

Impact of GENIUS Act on Crypto Legislation and Bitcoin

While XRP faced selling pressure, Bitcoin (BTC) trended higher on May 20 as investors considered the GENIUS Act vote on Capitol Hill. The Senate passed the GENIUS Act on May 19, with 16 Democrats reportedly changing their vote to support the bill. The passing of the GENIUS Act into law could be crucial for other crypto-related legislation to progress.

Crypto Amicus Curiae attorney John E. Deaton recently remarked:

Passing the GENIUS Act into law could pave the way for a vote on the Bitcoin Act. Senator Cynthia Lummis recently reintroduced the Bitcoin Act, proposing the US acquire one million BTC over five years with a 20-year statutory hold. If passed, BTC could climb to new highs on tighter supply.

US BTC-Spot ETF Market Sees Continued Investor Inflows

Meanwhile, the US BTC-spot ETF market contributed to the session’s gains, with total net inflows of $667.4 million on May 19. The US BTC-spot ETF market may extend its inflow streak to five sessions on May 20, underscoring positive investor sentiment.

According to Farside Investors, key flow trends for May 20 included:

Fidelity Wise Origin Bitcoin Fund (FBTC) saw net inflows of $23.3 million.
ARK 21Shares Bitcoin ETF (ARKB) reported net inflows of $6.4 million.
Grayscale Bitcoin Mini Trust (BTC) registered net inflows of $6.2 million.
Bitwise Bitcoin ETF (BITB) had net inflows of $5.8 million.

Excluding BlackRock’s (BLK) pending iShares Bitcoin XRP Trust (IBIT) data, the US BTC-spot ETF market saw total inflows of $41.7 million.

Market intelligence platform Santiment remarked on recent flow trends, stating:

BTC’s Market Outlook: Key Factors Driving Short-Term Trends

BTC gained 1.21% on May 20, reversing Monday’s 0.85% loss to a record high close at $106,856.

BTC’s short-term trajectory hinges on Capitol Hill developments, global trade conditions, macro data, and ETF inflows.

BTC's Market Outlook: Key

Potential scenarios:

Bearish Scenario: Renewed trade tensions, legislative deadlock, US recession fears, and ETF outflows. Bearish sentiment could send BTC below $100,000.
Bullish Scenario: Easing trade tensions, upbeat US economic data, GENIUS Act progress, and ETF inflows. Bullish sentiment could drive BTC above the record high of $109,312.

Final thoughts

The paper offers a thorough update on the latest events influencing XRP and Bitcoin, particularly regarding ETF approvals and legislative acts that can influence their values and market mood.

Particularly following the court decision in the SEC v. Ripple case, the delay in examining XRP spot ETF applications by the SEC has caused investor questions. This delay raises questions about the possibility of XRP spot ETFs and could affect XRP’s price in the near term. Constant regulatory changes—including how the SEC treats XRP institutional sales—may affect these timelines even more. The possibility of XRP-related ETFs getting approved sooner rather than later seems less clear given that the SEC is probably postponing ETF reviews, which increases pressure on XRP’s market sentiment.

Underperforming the larger market, XRP’s price dropped somewhat. The resolution of legal fights and whether the SEC approves XRP-related ETFs will probably determine its near-term price path. Any encouraging development in these spheres could cause prices to rise.