Litecoin ($LTC) has caught the market’s attention with a double-digit price jump, climbing 15.1% in the last 24 hours to hit $118—a level not seen in four weeks. This dramatic rise follows growing speculation about the approval of a Litecoin-based exchange-traded fund (ETF), drives by a regulatory filing update from Canary Capital. At the time of writing, Litecoin is trading at approximately $117, reflecting renewed optimism among investors and analysts.
The catalyst behind Litecoin’s price rally is an amended S-1 registration form submitted by Canary Capital to the U.S. Securities and Exchange Commission (SEC) on January 15. Such amendments often indicate feedback from regulators, suggesting that the filing is under active review.
Bloomberg ETF analysts Eric Balchunas and James Seyffart weighed in on the development, noting that the filing reflects engagement with the SEC. Balchunas described the update as a positive signal, predicting that Litecoin might soon join Bitcoin and Ethereum as the next cryptocurrency to gain approval for a spot ETF in the U.S.
Approval of a Litecoin ETF could mark a pivotal moment for the cryptocurrency, potentially driving significant institutional investment and broadening its adoption.
The regulatory outlook is further complicated by the SEC’s upcoming leadership transition. Paul Atkins, known for his crypto-friendly stance, is set to replace Gary Gensler as chairman.
This change introduces both uncertainty and opportunity. Analysts believe Atkins’ leadership could foster a more accommodating environment for crypto innovations, including ETFs. However, the transition may also delay immediate decisions as the new leadership settles in.
Canary Capital’s amended filing addresses critical aspects of ETF operations, including custodial arrangements with Coinbase and Bit Go. These revisions aim to align with SEC standards, covering accounting, marketing, legal, and tax considerations.
While the updates are promising, analysts note that the formal 19b-4 submission—a necessary step to trigger the SEC’s approval or denial process—has yet to be filed.
Blockchain analytics firm Santiment has reported a surge in activity among Litecoin’s largest holders. Since January 9, “whales” and “sharks” have accumulated approximately 250,000 LTC, worth $29 million.
This accumulation suggests that major investors are positioning themselves for potential gains, reflecting confidence in Litecoin’s prospects amid the ETF buzz.
Litecoin is not alone in the race for ETF approval. Rivals like Solana are also making moves, with Bitwise and Van Eck already filing 19b-4 forms for Solana-based ETFs. This gives them a procedural edge, but Litecoin’s established market reputation and its strong community support make it a formidable contender.
The approval of a Litecoin ETF could elevate its status among institutional investors, distinguishing it from other altcoins in the crowded crypto landscape.
Despite the rally, Litecoin is still 72% below its all-time high of $410, achieved in May 2021. This gap highlights both the challenges and the potential for growth.
If regulatory approval is secured, Litecoin could see a surge in demand, with institutional inflows driving the price closer to its previous highs. Analysts also believe that the current wave of accumulation by whales may signal a long-term bullish trend.
The next steps for Litecoin depend heavily on the SEC’s actions and Canary Capital’s ability to navigate the regulatory process. The market is also closely monitoring the impact of the SEC’s leadership transition on crypto policies.
For now, Litecoin’s price rally reflects growing confidence in its potential to secure a spot ETF. If successful, this milestone could transform Litecoin’s market dynamics, positioning it as a key player in the evolving crypto ecosystem.
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