XRP ETF May Open Doors to Institutional Manipulation, Warns Expert

• Versan Aljarrah expressed concerns that an XRP ETF could shift focus from XRP’s role as a bridge currency to speculative trading.
• He warned that institutional investors might manipulate prices, increasing market volatility and obscuring XRP’s intrinsic value.

Versan Aljarrah, founder of Black Swan Capitalist and an influential voice in cryptocurrency, has shared concerns over the growing excitement surrounding an XRP Exchange-Traded Fund (ETF).  In a recent statement on X, Aljarrah stated that the entry of an XRP ETF could jeopardize the use of digital currency as a bridge currency for cross-border transactions.

Aljarrah raised concerns over the possibility of an XRP ETF, noting that it may divert attention from the potential impact of cryptocurrency on its speculating use. He argued that institutional investors could use the ETF to manipulate prices and increase market risk. He argued that this change would mimic the same vices in conventional financial markets.

The ETF could also create a conflict of interest between XRP’s true function and its actual use in the financial market. Aljarrah noted that XRP’s decentralized nature can solve the problem of recalibrating the current reserved currency system, which relies heavily on the US dollar. Liquid frameworks could be optimized by leveraging XRP’s cross-border payment features, rendering outdated financial systems obsolete.

Aljarrah Advocates for XRP’s Role in Revolutionizing Global Finance

Aljarrah also pointed out that XRP’s main value proposition is its potential to revolutionize the existing global financial system and bring positive change. He expressed fears that the speculation element associated with ETFs might wash away XRP’s primary value proposition.  He said that the primary focus on short-term trading might make people miss out on the fact that XRP is a tool that can fight off inflation and redefine monetary systems.

Despite his warnings, Aljarrah acknowledged that other essential assets, such as corn and other commodities, have benefited from ETFs. But he argued that XRP is not the same thing at all. It is not a tool for speculation but to promote efficient payment and settlement of cross-border transactions and effective management of liquidity in a dynamic financial environment.

Diverging Opinions on XRP ETF’s Role

Max Avery, another cryptocurrency analyst, shared a different opinion on how an XRP ETF could affect the market. According to Avery, using ETFs helps improve the liquidity and stability of a given market, which might be in the best interest of XRP in the long run. Citing examples like corn ETFs, he noted that increased volume from institutional investors could stabilize XRP’s price and make it more effective in its intended use.

Avery also noted that using ETFs might reduce the volatility normally associated with large market trades. He said such stability would enable XRP to effectively perform the task of being a bridge currency, expanding on its cross-border payment function.

As previously reported by Crypto News Flash, asset manager Bitwise has reportedly filed for a spot exchange-traded fund (ETF) for Ripple (XRP), the seventh-largest cryptocurrency by market capitalization. The application for Bitwise’s XRP ETF was filed on September 30th in Delaware.

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