SEC Postpones Decision on Canary Capital's Proposed Litecoin (LTC) ETF

The Securities and Exchange Commission (SEC) has postponed its decision on Canary Capital's proposed spot Litecoin (LTC) exchange-traded fund (ETF).

The Securities and Exchange Commission (SEC) has postponed its decision on Canary Capital’s proposed spot Litecoin (LTC) exchange-traded fund (ETF).

The agency announced the delay on Monday, May 5, the official deadline for the decision, and is now seeking public input on the proposal’s compliance with regulatory requirements.

This postponement comes despite earlier speculation that Litecoin might receive different treatment from other cryptocurrency ETF applications. The SEC had already delayed decisions on several other crypto ETFs last week, including those for XRP, Hedera, and Dogecoin, but had not yet done so for the Litecoin proposal from Canary Capital.

In its filing, the SEC specifically asked for comments on whether the proposal “is designed to prevent fraudulent and manipulative acts and practices or raises any new or novel concerns not previously contemplated by the Commission.” This language suggests the regulator is applying similar scrutiny to Litecoin as it has to other cryptocurrency ETF applications.

Canary Capital, founded last year by former Valkyrie Funds co-founder Steven McClurg, submitted the initial paperwork for the Litecoin ETF in October. The company had reportedly received comments from the SEC regarding its application back in January, which had raised hopes among some observers.

It was indeed a delay: pic.twitter.com/0vipxSI1dl

— James Seyffart (@JSeyff) May 5, 2025

The news of the delay may impact Litecoin’s price, which has already been struggling to break through key resistance levels.

Technical analysis shows that Litecoin has been facing rejection at the $89.3 level, which represents the 78.6% Fibonacci retracement level. The cryptocurrency currently appears to be forming a short-term trading range between $83.3 and $88.8.

Market data indicates weak buying pressure over the past month, as shown by the Accumulation/A/D indicator. Despite showing some bullish momentum on lower timeframes, Litecoin maintains a bearish swing structure on the daily chart. For the overall trend to turn bullish, the price would need to breach the recent swing high of $96.5.

Liquidation data from Coinglass highlights $80.3 and $91.4 as the key price zones that could attract Litecoin in the near term. The $91.4 level appears to be the more likely target in the short term, though Bitcoin’s price action will likely influence Litecoin’s movements as well.

The delay for Litecoin’s ETF approval takes place within a changing regulatory environment. Paul Atkins, who was appointed as SEC Chair in April, replaced Gary Gensler, whose stance on cryptocurrency was often seen as cautious or skeptical.

Atkins’ position on cryptocurrency ETFs has been described as a “huge variable” by Bloomberg senior ETF analyst Eric Balchunas. The industry has yet to see the first major decision on crypto ETFs made under Atkins’ leadership.

Despite the delay, some experts maintain that Litecoin has strong prospects for eventual approval. ETF analysts at Bloomberg Intelligence had previously predicted that Litecoin would be the next cryptocurrency to be wrapped up in an ETF, given its $6.6 billion market capitalization and its status as an established cryptocurrency.