The launch of the spot Bitcoin (CRYPTO: BTC) exchange-traded funds (ETFs) in January was a landmark event. For good reason, the ETFs are widely seen as one of the primary catalysts behind Bitcoin’s triple-digit percentage gains this year. Tens of billions of dollars have flowed into these spot Bitcoin ETFs, and that has helped to push up the price of Bitcoin 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 over which cryptocurrency could be next in 2025. The three on my radar right now are Solana (CRYPTO: SOL), XRP (CRYPTO: XRP), and Cardano (CRYPTO: ADA). If any of them receive spot ETF approval in 2025, they could be off to the races.
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My top pick is Solana, which now ranks as the fifth-largest cryptocurrency in the world, with a market cap of about $100 billion. Solana is up about 90% this year (as of Dec. 18), after turning in a blistering 900% return in 2023.
Some investors view Solana as the next Ethereum, which is why its price has soared duting the past two years. Just like Ethereum, Solana is a smart contract blockchain network. Thus, anything Ethereum can do, Solana can also do. But Solana is considerably faster, cheaper, and easier to use than Ethereum, which is why top investors such as Cathie Wood of Ark Invest are so bullish on Solana.
Image source: Getty Images.
In terms of 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 signed off on spot Solana ETFs. And eight different Solana exchange-traded products (ETPs) currently trade within Europe. That’s more than for any other cryptocurrency, with the exception of Bitcoin and Ethereum.
Several prominent investment firms have already filed spot Solana ETF applications in the U.S. So official Securities and Exchange Commission (SEC) approval could come as soon as the first quarter of 2025, when the new Trump administration comes into office.
My second pick is XRP, which has been absolutely on fire ever since the presidential election. XRP was trading around $0.50 on Election Day, and nearly hit $3 before a recent pullback. For the year, XRP is up a hefty 145%.
Like Solana, XRP is often cited as a potential spot ETF prospect, and several different investment firms have already filed for spot XRP ETFs in the U.S. And, as is the case with Solana, XRP investment products already trade elsewhere in the world. In Europe, for example, there are three different XRP ETPs.
But there’s 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 rising-tide effect is especially important for XRP, which has been embroiled in 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, D.C., could grease the skids for any applications that might require SEC approval — such as a spot ETF application.
Last up is Cardano, which has soared 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 $36 billion market cap, which ranks No. 9 among all cryptocurrencies. Cardano is a cryptocurrency with a track record dating back nearly a decade, and a very loyal blockchain developer ecosystem, so it likely has long-term staying power.
The current thinking is that Cardano could triple in value to hit a price of $3, if a new spot ETF is approved in 2025. That would match its all-time high from three years ago, when Cardano traded for $3.10.
Of these three cryptocurrencies, I think Solana has the best chance of skyrocketing 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 likelihood of getting U.S. approval for a spot ETF product.
So, yes, Bitcoin is great. But there are plenty of other cryptocurrencies worth considering. The ETF investment thesis is a very powerful one, and being able to find the next crypto to get a spot ETF could be one way to boost your investment performance next year.
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Dominic Basulto has positions in Bitcoin, Cardano, Ethereum, and Solana. The Motley Fool has positions in and recommends Bitcoin, Cardano, Ethereum, Solana, and XRP. The Motley Fool has a disclosure policy.
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