Canary Capital Group recently submitted an application for a Litecoin (LTC) ETF to the U.S. Securities and Exchange Commission (SEC) on October 15th. If approved, this would mark the launch of the first-ever Litecoin ETF. In the meantime, investors can gain exposure to Litecoin through the Grayscale Litecoin Trust ($LTCN), which offers a similar advantage while reducing the risks associated with holding the physical asset. This mirrors the trajectory of the Grayscale Bitcoin and Ethereum Trusts, which evolved into ETFs earlier this year.
This filing is a big step for Litecoin to become a larger institutional asset, with many people now starting to see it as the "second Bitcoin." Given Litecoin’s established position in the market over the last 13 years, it is increasingly viewed as a practical payment network, particularly with its #1 merchant usage via services like BitPay.
Looking at the approval process for Bitcoin and Ethereum ETFs, which were approved in 2024, we can estimate that Litecoin’s approval could follow a similar timeline. The SEC took about eight months to review and approve the Bitcoin ETFs, with Ethereum ETFs following a similar path. If the SEC sticks to this timeline, the Litecoin ETF could be approved by mid-2025.
However, there are factors that could delay the process. The holiday season, including the end-of-year break, might slow down SEC activity. Additionally, the upcoming U.S. presidential election in November 2024 could lead to changes in administration, which may affect how the SEC handles regulatory decisions. With former President Trump leading in the polls, a shift in priorities is possible if he returns to office. His first term saw a deregulatory approach, including in finance, which could influence a faster approval process for cryptocurrency ETFs. On the other hand, any leadership changes could also cause delays as the new administration settles in, possibly pushing decisions into 2025.
Beyond Canary’s filing, we are also likely to see filings from major players like BlackRock, Fidelity, and Bitwise in the coming weeks. These companies, long known as key players in the financial space, could further legitimize cryptocurrency ETFs and strengthen the market's appeal. The SEC’s stance on these upcoming filings will be crucial, and with these firms backing the push for crypto ETFs, the regulatory landscape may be more favorable than in previous years.
The ETF filing outlines key risks, such as Litecoin’s price volatility and the uncertain regulatory environment. These are similar concerns that the SEC addressed with Bitcoin and Ethereum ETFs. However, given the successful approvals of these ETFs, there’s a belief that the regulatory hurdles for Litecoin may be lower, making its approval more likely.
For more details on the Canary Litecoin ETF filing, you can read the full registration statement here.
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