Longest US Shutdown Could Delay XRP ETF Approvals Amid Rising Crypto Interest

The ongoing shutdown of the United States government is anticipated to extend beyond 41.5 days, setting a new record as the longest in history. According to the most recent data from Kalshi, the federal offices may remain closed for at least 43 days, potentially pushing back the approval of cryptocurrency Exchange-Traded Funds (ETFs).

In the midst of this political deadlock, the demand for crypto-related financial products has surged remarkably. Satoshi Street, the colloquial reference for the cryptocurrency market, witnessed an influx of new ETF applications despite the bureaucratic delay. Six distinct XRP ETFs await approval between October 19 and 28, highlighting the industry’s resilience and optimism.

The federal shutdown, if it continues as predicted, could last nearly five times longer than the historical average durations for such government closures in the US. Kalshi’s projections suggest a 54.5% probability that the shutdown might surpass the 41-day mark, marking unprecedented times in the nation’s administrative history.

This extension of the shutdown significantly impacts the pipeline of ETFs queued up for authorization, starting from October 19. Despite these hurdles, issuing companies are undeterred, pressing on with the submission of XRP, HYPE, and staked Ethereum ETFs filings. This perseverance signals a shared belief that a rapid wave of approvals is on the horizon once the US Securities and Exchange Commission (SEC) resumes normal operations.

At the forefront of this burgeoning interest in crypto ETFs is the robust market demand. Charles Schwab’s CEO, Rick Wurster, emphasized in a discussion with CNBC that cryptocurrency remains a subject of significant intrigue and involvement among the firm’s clientele. Schwab’s clients now hold approximately 21% of all crypto ETFs in the United States, demonstrating the sector’s expanding footprint in mainstream finance.

Furthermore, visits to Schwab’s cryptocurrency platform have soared by 95% over the past year. This statistic underscores the mounting enthusiasm from both retail investors and institutional entities. In a testament to this interest, over five new cryptocurrency ETF applications have been lodged with the SEC in the past week, despite the standoff in Washington.

A recent application from VanEck highlights the launch of a Lido Staked Ethereum ETF, while another ambitious proposal from 21Shares seeks approval for a 2x leveraged ETF on the HYPE index. These filings, alongside several XRP and additional leveraged crypto ETFs, reflect a strategic push to capitalize on the evolving landscape of digital finance.

Industry analysts are optimistic that the end of the shutdown could trigger a significant acceleration in the approval of altcoin ETFs. Should this surge materialize, it has the potential to ignite substantial growth and renewed interest across various alternative digital currencies, thereby reinvigorating the broader cryptocurrency market.

As the shutdown continues to loom, its ripple effects are felt across the financial sector. However, the relentless drive for innovation and expansion within the crypto ETF space remains unabated, poised to accelerate once political normalcy returns. This anticipation of a transformative phase for digital assets stands as a testament to the resilience and forward-thinking mindset of the cryptocurrency industry.