Bloomberg analyst sees strong odds of a Litecoin ETF approval

An exchange-traded fund based on Litecoin (LTC) is likely to be the next spot crypto ETF in the US, Bloomberg analyst Eric Balchunas said.

We had heard chatter that the Litecoin S-1 had gotten comments back from SEC. This looks to confirm that which bodes well for our prediction that Litecoin is most likely to be the next coin approved. All that said, new SEC chair has yet to start and that’s a huge variable. https://t.co/cKFswPwcr0

— Eric Balchunas (@EricBalchunas) January 15, 2025

In October 2024, Canary Capital filed an S-1 registration statement for an LTC ETF with the SEC.

According to Balchunas, the firm received comments from the regulator on the proposal.

“This looks to confirm a good omen for our forecast that Litecoin is most likely to be the next coin approved. With all that said, the new SEC chair has yet to start work, and that is an important factor,” he said.

His colleague James Seyffart said the firm had already amended the filing.

NEW: @CanaryFunds just filed an amended S-1 for their Litecoin ETF filing. No guarantees — but this might be indicative of SEC engagement on the filing. Still no 19b-4 filing yet though

(A 19b-4 would actually start the potential approval/denial clock) h/t @isabelletanlee pic.twitter.com/wFtNOmbmYx

— James Seyffart (@JSeyff) January 15, 2025

“No guarantees, but this might be a sign of SEC engagement on the proposal,” he said.

Seyffart also noted that a 19b-4, which would amend exchange rules to allow the product to list, has not yet been filed. That means the clock for the regulator’s final decision on approving the fund has not started.

Prospects for crypto ETFs

President-elect Donald Trump nominated Paul Atkins, a crypto-friendly lawyer and former SEC commissioner, to chair the agency. His nomination still requires approval by Congress.

Current chair Gary Gensler will step down on January 20 — the day of Trump’s inauguration. He has faced criticism from the crypto community for a tough approach to regulating the industry.

However, in a recent interview Gensler noted that under his leadership futures-based bitcoin ETFs appeared in the US in 2021. In January 2024 the agency approved spot bitcoin products, and in July similar Ethereum funds. 

The SEC is reviewing five applications for Solana ETFs from VanEck, 21Shares, Canary, Bitwise and Grayscale. In November, Bitwise and 21Shares filed paperwork to launch spot XRP exchange-traded products.

Industry experts are optimistic about the prospects for new crypto ETFs being approved in the US, citing personnel changes in government and Gensler’s imminent departure.