Davos: Ripple Chief Foresees ETH ETF Coming but Avoids XRP Question

Speaking at the World Economic Forum summit in Davos, Ripple CEO Brad Garlinghouse shared expectations of an imminent Ethereum exchange-traded fund (ETF) following recent spot Bitcoin approvals. However, he declined to directly address prospects for a similar XRP investment product.

Keypoints

• Ripple CEO Brad Garlinghouse expects an Ethereum ETF to gain approval after Bitcoin ETFs but declined to predict an XRP one amid SEC battles.
• He criticized SEC Chairman Gary Gensler’s regulatory approach as a “political liability” that has not acted in the best interests of citizens.
• Garlinghouse believes pressure from the justice system pushed the SEC into approving Bitcoin ETFs against its wishes initially.
• He touched on Ripple expanding overseas given clearer policy abroad and the ongoing lawsuit against the SEC showing favorable progress.
• While an IPO is on hold, overseas listings remain an option as Ripple eyes non-US regulatory domains friendlier to crypto.

Garlinghouse believes the inflows into new Bitcoin ETFs make an Ether tracking fund inevitable next. “I think it’s a certainty. I’m not going to put a horizon on the time, but I think there will be other ETFs for sure,” he told CNBC.

His statements come after over a dozen spot Bitcoin ETFs launched last week, seeing immediate and enormous trading volumes in contrast to muted impact on Bitcoin’s actual price. The muted impact led some to suggest hype already peaked.

In the same interview, Garlinghouse slammed SEC Chairman Gary Gensler’s “arbitrary and capricious” stance that he believes hurts innovation and adoption. “I think he’s not acting in the best interest of the citizenry,” said the Ripple CEO.

He attributes Bitcoin ETF approvals to mounting legal pressure on the SEC rather than a change of heart from regulators. Garlinghouse thinks judicial intervention compelling policy shifts could enable more crypto investment vehicles ahead.

“The reality is we have a Bitcoin ETF only because a U.S. court said to the SEC, ‘You’re being arbitrary and capricious in your application of the law.’ What would be sad is if every ETF had to go through that same journey,” Garlinghouse noted.

Any takers? pic.twitter.com/KbKsCVOkLa

— Brad Garlinghouse (@bgarlinghouse) January 16, 2024

The commentary indirectly referenced Ripple’s own multi-year legal battle against the SEC over allegations of selling XRP tokens as an unregistered security. Garlinghouse maintains the token’s decentralized and functional nature places it outside securities jurisdiction.

When asked directly about prospects for an XRP ETF, Garlinghouse gave an ambiguous response, declining to put a timeframe around the possibility. The hesitancy likely stems from sensitivity over ongoing litigation coupled with XRP’s disputed status.

Beyond regulation, the Ripple chief touched on augmenting the company’s presence abroad in regions with clearer policy guidance. He also conveyed optimism on progress made in the SEC lawsuit, with victories letting Ripple focus on growth.

An eventual initial public offering remains shelved for now, but overseas listings could offer an alternative route to the public markets. As Ripple expands globally, its legal skirmish with the SEC looks primed for further appeals stretching through the court system.