Launch on the spot Bitcoin(CRYPTO: BTC) Exchange traded funds (ETFs) in January were a major event. For good reason, the ETFs are widely regarded as one of the main catalysts behind Bitcoin's triple-digit percentage gains this year. Tens of billions of dollars have flowed into these spot Bitcoin ETFsand that has helped push the price of Bitcoin up throughout the year.
But Bitcoin is no longer the only cryptocurrency with a spot ETF. Ethereum(CRYPTO: ETH) joined the ETF party in July, and speculation is mounting about which cryptocurrency could be next in 2025. The three currently on my radar are Solana(CRYPTO: SOL), XRP(CRYPTO: XRP)a Cardano(CRYPTO: ADA). If any of them receive spot ETF approval in 2025, they could be off to the races.
My best choice is Solanawhich now ranks as the fifth largest cryptocurrency in the world, with a market cap of around $100 billion. Solana is up around 90% this year (as of 18 December), having turned in a blistering 900% return in 2023.
Some investors consider Solana to be the next Ethereum, which is why its price has skyrocketed in the past two years. Just like Ethereum, Solana is a smart contract blockchain network. So, anything Ethereum can do, Solana can also do. But Solana is significantly faster, cheaper, and easier to use than Ethereum, which is why major investors like Cathie Wood of Ark Invest are so bullish on Solana.
Image source: Getty Images.
As for Solana getting an ETF in 2025, it's worth paying attention to what's happening in the rest of the world. In Brazil, for example, regulators recently approved Solana ETFs on the spot. And eight different Solana exchange traded products (ETPs) are currently trading within Europe. That's more than for any other cryptocurrency, except Bitcoin and Ethereum.
Several prominent investment companies have already filed Solana ETF applications in the United States in the United States. So the official approval of the Securities and Exchange Commission (SEC) could come as soon as the first quarter of 2025, when the new Trump administration takes office.
My second choice is XRP, which has been absolutely on fire since the presidential election. XRP was trading around $0.50 on Election Day, and nearly hit $3 before pulling back recently. For the year, XRP is up a whopping 145%.
Like Solana, XRP is often cited as a potential spot ETF prospect, and several different investment companies have already filed for spot XRP ETFs in the US And, as is the case with Solana, XRP investment products are already trades elsewhere in the world. In Europe, for example, there are three different XRP ETPs.
But there is more to XRP than just the ETF narrative. More so than any other cryptocurrency, XRP has benefited from the so-called Trump trade. This is essentially a bet that the pro-crypto optimism surrounding the Trump administration will lead to a rising tide for all cryptos.
This higher tidal effect is particularly important for XRP, which has been the subject of regulatory controversy since December 2020. That's when the SEC filed a lawsuit against Ripple, the company behind the XRP token. The growing consensus now is that the SEC will abandon this lawsuit in 2025, freeing Ripple to go back to business as usual. And a pro-crypto environment in Washington, DC, could grease the boots for any applications that might need SEC approval – like an ETF application on the spot.
Last up is Cardano, which has surged in value after the election to break through the $1 mark. Cardano is now up 55% for the year. That's the same as Ethereum but nowhere near Bitcoin (up 105%), which is why Cardano has flown under the radar of many investors.
Like Ethereum, Cardano is a smart contract blockchain network. And, just like Solana, Cardano is a potential Ethereum killer. Cardano currently has a market cap of $36 billion, which ranks 9th among all cryptocurrencies. Cardano is a cryptocurrency with a history dating back nearly a decade, and a very loyal blockchain developer ecosystem, so it likely has long-term staying power.
The current view is that Cardano could triple in value to reach a price of $3, if a new spot ETF is approved in 2025. That would match its all-time high since three years ago, when Cardano is trading at $3.10.
Of these three cryptocurrencies, I think Solana has the best chance of increasing in value next year. It has less regulatory risk than XRP, and has more upside potential than Cardano. And, based on Solana ETF approvals happening elsewhere in the world, Solana appears to have the highest probability of getting US approval for a spot ETF product.
So, yes, Bitcoin is great. But there are plenty of other cryptocurrencies worth considering. The thesis of ETF investing is a very powerful one, and being able to find the next crypto to get an ETF on the spot could be one way to boost your investment performance next year.
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Dominic Basulto He has positions in Bitcoin, Cardano, Ethereum, and Solana. The Motley Fool has posts and recommends Bitcoin, Cardano, Ethereum, Solana, and XRP. The Motley Fool has a disclosure policy.
