XRP Trading Volume Rises as SEC Begins ETF Application Review

TLDR

• XRP trading has surpassed Ethereum on Coinbase, contributing 14% of Q4 trading revenue
• After Ripple’s partial SEC victory and exchange relistings, XRP now ranks third in liquidity behind BTC and ETH
• SEC has started a 240-day review window for XRP ETF applications
• Bloomberg analysts estimate 65% chance of XRP ETF approval
• Trading volumes expected to increase as ETF decision deadline approaches

The cryptocurrency XRP has seen a substantial increase in trading activity across United States exchanges, with volumes reaching new highs since November 2024. Recent data from crypto analytics firm Kaiko reveals that XRP trading demand has overtaken several major cryptocurrencies on US-based platforms.

Coinbase’s latest earnings report showcased XRP’s growing prominence in the crypto trading landscape. For the first time in the exchange’s history, XRP generated more trading revenue than Ethereum during the fourth quarter of 2024, accounting for 14% of total trading revenue.

The revival in XRP trading activity can be traced back to the cryptocurrency’s return to major US exchanges following Ripple Labs’ partial victory in its legal battle against the Securities and Exchange Commission (SEC). The court ruling clarified that XRP sales on cryptocurrency exchanges did not constitute security offerings, opening the door for its relisting on prominent trading platforms.

Market data from Kaiko’s liquidity rankings places XRP in third position, trailing only Bitcoin and Ethereum. The ranking system evaluates cryptocurrencies by comparing their market capitalization to their trading liquidity across various platforms. Among all digital assets, only Bitcoin, Ethereum, XRP, and Solana demonstrate liquidity levels that align closely with their respective market capitalizations.

The upswing in trading activity coincides with mounting speculation about potential approval of spot XRP exchange-traded funds (ETFs). Various asset management firms have submitted applications to launch XRP ETF products, following the successful approval of Bitcoin ETFs in January 2024 and Ethereum ETFs in May 2024.

The SEC has formally begun its review process for XRP ETF applications, initiating a 240-day period during which the regulatory body will evaluate the proposals. This development has sparked increased interest from both retail and institutional investors.

Bloomberg analysts Eric Balchunas and James Seyffart have assessed the probability of a spot XRP ETF approval at 65%. Their analysis suggests these odds could improve further if the SEC’s new leadership resolves remaining lawsuits that question XRP’s security status.

Trading platforms are preparing for heightened market activity as the ETF decision deadline approaches. This anticipation stems from observations of similar patterns during the Ethereum ETF approval process in May 2024, when both trading volumes and prices increased markedly following the SEC’s unexpected green light.

XRP’s Trading Patterns

The data shows that XRP’s trading patterns have evolved since its relisting on major exchanges. Daily trading volumes have shown consistent growth, particularly during US market hours, indicating increased participation from American investors.

Institutional interest in XRP has grown steadily since the court victory against the SEC. Professional trading firms and market makers have expanded their XRP operations, contributing to deeper market liquidity and more efficient price discovery.

The cryptocurrency’s trading metrics reveal improved market depth across multiple exchanges. Order book data indicates larger trade sizes can be executed with minimal price impact, a key indicator of market maturity.

Exchange data shows a diverse mix of both spot and derivative trading activity. Futures and options markets for XRP have seen increased participation, suggesting more sophisticated trading strategies are being employed.

Market makers report tighter bid-ask spreads for XRP trading pairs, reflecting enhanced market efficiency and reduced trading costs for participants. This improvement in trading conditions has attracted more algorithmic trading activity.

The geographic distribution of XRP trading has shifted noticeably since US exchanges resumed support for the cryptocurrency. While Asian markets previously dominated XRP trading volumes, US venues now represent a larger share of global activity.

Recent trading data indicates that XRP’s 24-hour trading volumes have maintained elevated levels throughout February 2025. The SEC’s formal acknowledgment of XRP ETF filings on February 10, 2025, triggered a fresh wave of trading activity across US exchanges.