Asset management firm Canary Capital has submitted an S-1 registration for a Litecoin ETF product. The Steven McClurg-founded lodged the Canary Litecoin ETF product with the United States Securities and Exchange Commission (SEC).
The filing is focused on providing exposure to the price of LTC held by the Trust. This comes less than a week after the asset manager took a similar bold step with an XRP ETF application.
Canary Capital Lauds Litecoin’s Role in Crypto Ecosystem
According to Canary Capital, the decision to choose LTC comes from understanding the altcoin’s leading role in the crypto ecosystem.
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Litecoin’s key features make it attractive to many institutional investors. Investing in Litecoin offers a unique exposure to a time-tested and reliable cryptocurrency.
“As one of the longest-running blockchains with 100% uptime since its inception, Litecoin has demonstrated a proven track record of security and reliability with significant enterprise-grade use cases,” the asset management firm wrote in its filing.
Besides this move from Canary Capital, CoinShares operates a Litecoin-based exchange-traded product in Switzerland. Grayscale Investments bagged approval from the Financial Industry Regulatory Authority (FINRA) four years ago to offer a dedicated Litecoin Trust.
These are some of the few Litecoin products in the global ETF market.
Will the US SEC Approve Litecoin ETF? Price Impact
Senior Bloomberg ETF Analyst James Seyffart claims that Litecoin and Bitcoin share similar regulatory concerns. He noted that Litecoin as a fork of Bitcoin is a premise for the former to count as a commodity.
In January 2024, about eleven spot Bitcoin ETF applications from BlackRock, Bitwise, and Fidelity received SEC approval.
In the case of Litecoin, “to get an ETF approved under the current administration, there needs to be a sizeable and liquid futures market that is federally regulated in the US. Litecoin doesn’t fit that requirement right now,” Seyffart opined.
However, he is positive that the election of a pro-crypto President in the United States will affect the filing. For context, a change in SEC’s leadership is hinged on the outcome of the upcoming US 2024 presidential elections.
“We would still need to see a 19b-4 filing before any clocks start ticking for an SEC response,” he added.
Should the SEC approve, the LTC price may record a significant rally. With institutional backing, it may potentially inch toward its All-Time High (ATH) in the long run. The coin is trading at $69.30, corresponding to a 3.51% increase in the past 24 hours.
Crypto ETFs in the US, Solana, XRP, and Now Litecoin
After Bitwise filed the first spot XRP ETF application a few days ago, Canary Capital followed along.
The trend with these crypto ETFs underscores the growing institutional interest in digital assets beyond Bitcoin and Ethereum. When spot Bitcoin ETFs went live at the beginning of the year, several analysts predicted that other crypto ETFs would follow.
So far, VanEck and 21Shares have submitted their respective Solana ETF filings. Although the 19b-4 filings were later pulled down from the Cboe website, the gesture is still promising.
Brad Garlinghouse, Ripple CEO, expects more XRP ETF filings to appear on the SEC’s desk soon enough. Much more, asset managers may look in the direction of cryptocurrencies other than XRP, Solana, and Litecoin.
