SEC Delays Decision on a Proposal from Canary Funds to List a Spot Litecoin (LTC) exchange-traded fund (ETF)

The U.S. Securities and Exchange Commission (SEC) has delayed its decision on a proposal from Canary Funds to list a spot Litecoin (LTC) exchange-traded fund (ETF).

The U.S. Securities and Exchange Commission (SEC) has requested public comment on a proposal from Canary Funds to list a spot Litecoin (LTC) exchange-traded fund (ETF). The agency is examining whether the ETF would effectively prevent and detect fraud and manipulation.

In its filing on Monday, the SEC stated that it's interested in understanding if the Litecoin ETF raises any new or unique issues that haven't been discussed in previous filings for similar products.

This follows a week of the SEC deferring decisions on several crypto ETFs, including those tied to XRP, Hedera, and Dogecoin. However, despite the delays, the overall tone suggests a potential openness to crypto ETFs under the current administration.

Since the beginning of the year, the SEC has shown a more relaxed approach towards crypto. This includes dropping some cases against crypto firms and holding meetings to discuss the legal frameworks for digital assets.

Moreover, the new SEC Chair Paul Atkins has expressed his belief in the "enormous advantages" of crypto and his desire to collaborate with politicians to establish a suitable regulatory framework.

While several ETFs have been filed for approval, the Litecoin ETF has a better chance at early approval compared to others, according to Bloomberg ETF analyst James Seyffart.

On X, Seyffart noted, "If any asset has a chance of early approval, it's Litecoin, in my opinion. Articles on Hedera & XRP are next. Feels like the new admin is more open to approving, which is a change from the last one."

Currently, three companies—Canary Funds, Grayscale, and CoinShares—are vying to launch the first Litecoin ETF. However, investors will have to wait as the SEC is now opening the floor to public opinion on whether the ETF would effectively prevent and detect fraud and manipulation.