The bank’s analysis, which considers the adoption rates of existing cryptocurrency ETFs, highlights the challenges these altcoin funds may face in matching Bitcoin’s dominance.
The report projects that Solana and XRP ETFs could each draw billions of dollars, with Solana funds expected to attract between US$4 to US$8 billion and XRP funds ranging from US$3 to US$6 billion. However, these figures are modest compared to Bitcoin and Ethereum ETFs, which have garnered significant investor interest since their inception.
JP Morgan’s predictions are based on the adoption rates observed in current spot-cryptocurrency ETFs. At the time of the analysis, Bitcoin ETFs held approximately US$108 billion in assets, representing about 6% of Bitcoin’s total market capitalization. These funds, introduced a year ago, have seen remarkable uptake.
In comparison, Ether ETFs, launched six months ago, have gathered US$12 billion, equating to a 3% penetration rate of Ethereum’s market value.
Despite the promising outlook for Solana and XRP ETFs, the report notes that these funds will likely manage smaller asset pools compared to their Bitcoin and Ethereum counterparts. Bitcoin continues to be the preferred cryptocurrency for both direct trading and investment through ETFs, thanks to its established position in the market.
Several asset managers, including Grayscale, VanEck, and Bitwise, have already filed for XRP and Solana ETFs. XRP and Solana rank among the top cryptocurrencies by market capitalization, but they face stiff competition from Bitcoin and Ethereum, which occupy the top two spots.
The success of Bitcoin ETFs, such as BlackRock’s iShares Bitcoin Trust, which amassed US$50 billion in assets within its first year, sets a high bar. Ethereum ETFs, while growing, have seen slower adoption compared to their Bitcoin counterparts.