Litecoin’s Shot at the Big Leagues: Could it be the Next Crypto ETF?

In a move that’s got the crypto community buzzing, Canary Capital has filed an amended S-1 form for its Litecoin exchange-traded fund (ETF). This could be the green light Litecoin needs to become the next major digital asset to get the ETF treatment in the United States, following in the footsteps of Bitcoin and Ether. The filing, which was submitted on January 15, seems to confirm the rumors that Litecoin is being considered by the Securities and Exchange Commission (SEC).

The SEC’s Stance and What it Means

According to Bloomberg analysts, this development is a positive sign for Litecoin’s chances of getting approved. Eric Balchunas, a Bloomberg ETF analyst, thinks that Litecoin is the most likely candidate to be the next coin to get the nod from the SEC. However, he also notes that the upcoming leadership change at the SEC is a wild card that could impact the decision. The amended S-1 registration statement is often a sign that the SEC has provided feedback to the prospective ETF issuer, in this case, Canary Capital.

The Approval Process: What’s Next?

While this is a step in the right direction, there are still a few hurdles to clear. For instance, Canary Capital needs to file a 19b-4 form to kickstart the approval or denial process. Other coins, like Solana, are already ahead in this regard, with several ETF issuers having filed their 19b-4s back in November. Canary’s amended S-1 form also includes updates on its agreements with crypto custodians Coinbase and BitGo, as well as other accounting and marketing matters.

Market Reaction and Implications

The news has already had an impact on the market, with Litecoin’s price surging over 15% on January 15-16. This rally has been attributed to whales and “sharks” scooping up a significant amount of Litecoin, worth around $29 million, since January 9. If approved, Litecoin would become the third spot crypto ETF in the United States, which could lead to even more mainstream adoption and investment. The timing of this development is also interesting, coming just before the inauguration of US President-elect Donald Trump, who has assembled a pro-crypto administration.

Other Contenders and the Bigger Picture

XRP is also in the running to be approved in spot ETF form by the SEC, and analysts at JPMorgan predict that approved spot Solana and XRP ETFs could attract between $3 billion to $6 billion and $4 billion to $8 billion in net assets over the first year. With the crypto regulatory environment expected to become more friendly under the new administration, it’s likely that we’ll see more coins getting the ETF treatment in the near future. As the crypto landscape continues to evolve, it’s exciting to think about what other developments are on the horizon.