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Litecoin Surges 30% as SEC Invites Public Comments on LTC ETF

Coin WorldThursday, Jan 30, 2025 6:23 am ET

1min read

Litecoin Price Jumps 30% as SEC Invites Public Comments on Canary’s LTC ETF Filing

The Securities and Exchange Commission (SEC) has opened a 21-day public comment period for Canary Capital’s Litecoin ETF proposal, marking a significant milestone in the cryptocurrency market. This development comes as the first altcoin ETF application to reach this stage of the regulatory process.

The Canary Litecoin ETF aims to track the CoinDesk Litecoin Price Index (LTX) and would implement a cash-only system for share creation and redemption. This structure would allow investors to gain exposure to Litecoin through their standard brokerage accounts, eliminating the need for direct cryptocurrency management.

The cryptocurrency markets responded positively to the news, with Litecoin’s price rising 15.1% to reach $117. Trading volume and open interest also increased, indicating growing market participation. Technical analysts observed the formation of a falling wedge pattern, suggesting potential for further price movement.

Canary Capital’s proposal comes as part of a broader wave of crypto ETF applications. Grayscale has filed to convert its existing Litecoin Trust into an ETF, while CoinShares has submitted an S-1 form for a separate offering. The increased interest follows the successful launches of spot Bitcoin ETFs in January 2024 and Ethereum ETFs in May of the same year.

The proposed ETF structure includes a comprehensive custody framework and involves specialized financial firms known as Authorized Participants. These broker-dealers would handle the creation and redemption of ETF shares through cash transactions rather than dealing directly with the cryptocurrency.

The public comment period will allow investors and market participants to share their views on the proposed Litecoin ETF. The SEC will consider these submissions as part of its review process. Acting SEC Chair Mark Uyeda and Commissioner Hester Peirce have hinted at potential shifts in the agency’s approach to crypto regulation compared to previous administrative positions.

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