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HomeCrypto NewsMarketWhy a Litecoin ETF is "Most Likely" To Be Approved Next: Senior Bloomberg ETF Analyst

Why a Litecoin ETF is “Most Likely” To Be Approved Next: Senior Bloomberg ETF Analyst

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Litecoin is “most likely” to be the next crypto asset to receive an ETF wrapper in the U.S., according to Senior Bloomberg ETF analyst Eric Balchunas.

Following the SEC’s approval of spot Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds (ETFs) in 2024, the big question for many crypto market participants has been which crypto asset would get the highly coveted traditional investment wrapper next.

While most of the chatter has been around Solana (SOL) and XRP, a Bloomberg analyst has tipped one unlikely contender to leapfrog these fan favorites: Litecoin (LTC). Here’s why.

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SEC Engagement

Litecoin is “most likely” to be the next crypto asset to receive an ETF wrapper in the U.S., according to Senior Bloomberg ETF analyst Eric Balchunas.

Balchunas expressed this view on Wednesday, January 15, in response to reports that Canary Capital had filed an update to its S-1 filing for a Litecoin ETF, a likely indication of SEC engagement. An S-1 is a registration statement filed with the SEC by firms seeking to launch a new security.

Canary Capital updated its filing to show that U.S. Bancorp Fund Services would administer the proposed ETF, while Coinbase and BitGo will provide custody services for the fund’s Litecoin.

Bloomberg’s Balchunas asserted that the update supported Litecoin’s odds of getting the ETF wrapper next, though he noted that the looming SEC leadership change could be a huge deciding factor. 

This statement comes as next week, present SEC Chair Gary Gensler is set to step down as Donald Trump assumes the office of president. While Trump has nominated crypto-friendly Paul Atkins to take over from Gensler, it is unclear when the nomination will receive Senate approval.

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Meanwhile, fellow Senior Bloomberg ETF analyst James Seyffart has charged that market participants keep an eye out for a 19b-4 filing, stressing that it would confirm that efforts were underway to approve or deny the offering. 

This form outlines listing rules and justification for the product. Unlike the S-1, which is filed by the prospective issuer, the 19b-4 is filed by self-regulatory organizations, typically the exchange the ETF plans to trade on. In the case of Canary Capital’s planned Litecoin ETF, this will be the Nasdaq.

No Surprise?

With some considering Litecoin as an older and less used crypto asset, many have expressed shock at the likelihood of the token getting an ETF before Solana and XRP. However, it should come as no surprise, considering the present SEC leadership’s stance on the classification of crypto assets.

The Gensler-led agency has repeatedly expressed apprehension about most crypto assets, except Bitcoin, and specifically named Solana and XRP as unregistered securities in ongoing enforcement actions.

With this in mind, it is easy to see why Litecoin could easily get the agency’s nod. It shares many similarities with Bitcoin, including the less active role of its original developers.

Following the recent Canary Capital S-1 filing amendment, Litecoin has unsurprisingly outperformed the top 20 crypto assets by market capitalization to trade nearly 17% higher on the day at over $119.

DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.

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Okoya David
Okoya David
Okoya David Kio is a crypto enthusiast passionate about understanding what makes the nascent market tick. When he's not pondering about cryptocurrencies, you might find him in a BP debate room trying to proffer solutions to age-old societal problems.

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