Litecoin Could Be the Next Crypto ETF to Receive SEC Approval

ETF analyst James Seyffart has shared that Canary Capital amended the S-1 filing for its Litecoin ETF, a step that suggests increased engagement from the US Securities and Exchange Commission (SEC).

A US Securities and Exchange Commission (SEC)-authorized Litecoin (LTC) exchange-traded fund (ETF) may be on the horizon, as indicated by a recent development in the regulatory approval process.

According to ETF analyst James Seyffart, Canary Capital has amended the S-1 filing for its Litecoin ETF. This step suggests that the SEC is actively engaging with the proposal.

However, Seyffart also notes that a 19b-4 filing, which would officially start the clock for the SEC's potential approval or denial of the ETF, has not yet been submitted.

Here's a breakdown of the latest news and what it could mean for Litecoin and the crypto ETF landscape:

Canary Capital filed for the Litecoin ETF in October 2023, following its application for an XRP ETF. While the initial filing is a standard procedure, the amendment may indicate increased attention from the SEC.

The S-1 filing is a crucial step in the SEC's approval process for any new investment product, including ETFs. The filing includes detailed information on the fund's objectives, strategies, risks, and other relevant aspects.

While the amendment itself does not guarantee approval, it does signal that the SEC is paying attention to the proposal and that the regulatory body is actively engaging with the application.

However, as Seyffart points out, a 19b-4 filing has not yet been submitted. This filing is a formal request to list and trade the ETF on a national securities exchange.

This filing is essential to start the official clock for the SEC's potential approval or denial of the ETF, meaning the process could still take some time.

Another Bloomberg analyst, Eric Balchunas, further supports the idea that the SEC has begun engaging with the Litecoin ETF filing. Balchunas cites "chatter" suggesting that the SEC has provided feedback on the S-1.

In his view, this strengthens the case for Litecoin to become the next crypto to receive ETF approval. Balchunas and Seyffart both seem to be hinting at the possibility of an imminent approval.

However, both analysts also caution that the appointment of a new SEC chair introduces a significant variable that could impact the timeline and ultimately the decision-making process.

To date, the SEC has been cautious in approving cryptocurrency ETFs, with Bitcoin and Ethereum ETFs receiving some notable scrutiny. Despite several applications, no other crypto ETFs have been approved by the SEC beyond BTC and ETH.

The news of the ETF application has boosted Litecoin's price with LTC trading at $119.22 at press time. The crypto's price rose 16.8% over the past 24 hours.

Moreover, Grayscale's Litecoin Investment Trust already offers US investors exposure to LTC through its ETP. It appears that the Grayscale Trust has quietly amassed over 500,000 LTC in 2024.

Based on Coinglass data, the Trust held less than 1.5 million LTC coins in January 2024. A year later, the investment giant's holdings have increased to over 2 million. Grayscale's move suggests that the firm anticipates strong investor interest in Litecoin.