With US President-elect Donald Trump just four days away from inauguration and new leadership coming to the Securities and Exchange Commission (SEC), additional cryptocurrencies may soon join bitcoin (BTC) and ether (ETH) in receiving their own spot exchange-traded funds (ETFs ).
Of these, litecoin (LTC) is likely to be the first to receive the nod, according to Eric Balchunas and James Seyffart, two ETF analysts at Bloomberg Intelligence.
“Canary Funds just filed an amended S-1 for their litecoin ETF application. No guarantees – but this could be an indication of SEC involvement in the filing,” Seyffart wrote on X.
“We had heard talk that litecoin S-1 had received comments back from the SEC,” Balchunas wrote, adding that the amended filing “bodes well for our prediction that litecoin will most likely be the next approved coin.”
Why Litecoin? With a market capitalization of $8.8 billion, litecoin is only the 11th largest cryptocurrency in the CoinDesk 20 (an index of the top 20 cryptocurrencies excluding stablecoins, memecoins and exchange coins) and the 24th largest coin overall.
But litecoin is a bitcoin fork, meaning its protocol follows the same basic rules as Bitcoin; for example, it uses a Proof-of-Work consensus mechanism. Importantly, the SEC has never called litecoin a security, unlike major cryptocurrencies like solana (SOL) and ripple (XRP).
“We expect a wave of cryptocurrency ETFs next year, albeit not all at once,” Balchunas wrote in December. “First probably the bitcoin and ether combo ETFs, then probably litecoin (because it’s a fork of bitcoin = commodity), then HBAR (because not labeled security) and then XRP/Solana (which have been labeled securities in pending litigation ).”
Still, the SEC under Paul Atkins will likely approach the crypto industry differently than it has under Gary Gensler, which Balchunas noted was a “big variable.” Importantly, Canary Funds — which filed its S-1 filing for a litecoin ETF in October — has yet to file its 19b-4, meaning there is currently no deadline for the SEC to approve or disapprove the product .
