The landscape of cryptocurrency ETFs is expanding, but not all digital assets are easily adaptable to this financial product. GSR's recent analysis highlights the challenges XRP and Cardano face in transitioning to ETFs.

Using a detailed scoring system that includes decentralization and market demand metrics, GSR evaluates various cryptocurrencies. Decentralization factors, such as permissionless participation and hardware diversity, are critical, with metrics like the Nakamoto Coefficient revealing network vulnerabilities. XRP and Cardano scored low on decentralization, with scores of -0.9 and -0.1, respectively.

Market demand, including market cap, trading volume, and community activity, is also significant. Despite their popularity, XRP and Cardano scored -0.2 and -0.5 in demand, indicating lower potential for ETFs compared to other cryptocurrencies.

GSR's analysis suggests substantial hurdles for XRP and Cardano ETFs due to their low decentralization and demand scores. In contrast, cryptocurrencies like Ethereum, Solana, and NEAR received more optimistic evaluations.

GSR's ETF Possibility Score weighs decentralization at 33% and demand at 67%. Despite the challenges for XRP and Cardano, VanEck has filed for the first-ever Spot Solana ETF with the SEC, highlighting Solana's rising prominence.

Bitcoin and Ethereum face a mixed outlook. Bitcoin spot ETFs have seen variable inflows, while Ethereum's potential ETF is awaiting final approvals, expected soon. The market's response to these developments has been cautious, with slow but positive trends for Bitcoin ETFs.