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XRP Allocations More Common Than Solana Among Institutions: Coinbase, EY

XRP Allocations More Common Than Solana Among Institutions: Coinbase, EY

  • 18.03.2025 20:51
  • decrypt.co
  • Keywords: XRP, Solana

Institutional investors prefer XRP over Solana, with higher allocations despite growing interest in alternative cryptocurrencies. Regulatory challenges and limited ETF access impact adoption.

Coinbase ProductsCoinbase ReportsCOINsentiment_satisfiedMS/PLsentiment_satisfied

Estimated market influence

Coinbase

Coinbase

Positivesentiment_satisfied
Analyst rating: Buy

Coinbase is a major cryptocurrency exchange that has been actively involved in the development and promotion of ETFs tracking altcoins like XRP and Solana. Their partnership with EY-Parthenon for surveys indicates their influence in shaping institutional investment trends.

EY

Positivesentiment_satisfied
Analyst rating: —

EY, through its subsidiary EY-Parthenon, conducted a survey with Coinbase to analyze institutional investor behavior towards altcoins like XRP and Solana. Their collaboration highlights their role in providing market insights and influencing investment strategies.

Ripple Labs

Negativesentiment_dissatisfied
Analyst rating: N/A

Ripple Labs is facing legal challenges from the SEC, which has impacted the perception and adoption of its XRP token among institutional investors. The ongoing lawsuit has created regulatory uncertainty, affecting investor confidence.

Solana Foundation

Negativesentiment_dissatisfied
Analyst rating: N/A

Solana's market performance has declined since the survey period, potentially due to regulatory concerns and competition from other altcoins like XRP, which has a more favorable legal environment.

Context

Analysis: XRP Allocations Outpace Solana Among Institutions

Key Survey Findings

  • Survey respondents: 352 institutional investors globally.
  • XRP allocation: 34% of respondents.
  • Solana allocation: 30% of respondents.
  • Cardano ownership: ~25% of respondents.

Institutional Investment Preferences

  • Portfolio diversification: 68% of respondents hold only one or two cryptocurrencies beyond Bitcoin and Ethereum.
  • Investment vehicles:
    • 29% prefer holding assets in digital wallets.
    • Majority favor products resembling ETFs.

Regulatory Landscape and Concerns

  • Regulatory uncertainty: 53% of respondents cited crypto’s uncertain regulatory backdrop as a concern.
  • Key areas for clarity:
    • 49% prioritize clarification on whether crypto assets are commodities or securities.
    • 50% highlight crypto custody rules as critical.

Market Trends and Dynamics

  • Altcoin ETF interest: 68% of respondents expressed likelihood to invest in new crypto exchange-traded products tracking single assets (e.g., XRP, Solana).
  • Post-election performance:
    • Solana has relinquished all post-election gains.
    • XRP remains stable, trading at several times its pre-election value.

Competitive Dynamics

  • XRP vs. Solana:
    • XRP’s association with Ripple Labs may benefit from President Trump’s crypto-friendly stance.
    • Solana faces challenges due to regulatory scrutiny and delayed ETF approvals in the U.S.

Regulatory and Market Implications

  • ETF delays: Solana-based ETFs face uncertainty due to SEC review, enforcement actions, and public comment periods.
  • Regulatory clarity: The SEC’s Crypto Task Force aims to establish clearer rules, but legislative efforts on Capitol Hill may shift oversight to the CFTC.

Long-Term Effects

  • Institutional adoption: Limited opportunities for altcoin exposure through traditional brokerage accounts may drive interest in ETFs.
  • Market dynamics: Regulatory clarity and asset performance will likely shape institutional investment trends in 2025 and beyond.