- Analysts see Litecoin’s Bitcoin-like traits as a potential edge in the ETF approval race.
- Litecoin hits a three-year high price near $140.
- Fund managers also vie to launch Solana and XRP ETFs.
Litecoin, once a top-five cryptocurrency by market value and considered by many to be the original altcoin, has seen its price surge 31% over the past week.
Canary Capital’s newly proposed Litecoin-based exchange-traded fund could make it the first altcoin fund approved under the Trump administration.
Bloomberg ETF analysts Eric Balchunas and James Seyffart noted the Securities and Exchange Commission’s apparent willingness to expedite approval, in line with expectations under the potential incoming leadership of Paul Atkins.
“Litecoin ETF now has all the boxes checked,” Balchunas said. “With a new SEC sheriff in town, this could be the first altcoin ETF to hit the market.”
But don’t count out the competition — fund managers also vie to get ETF approval for crypto heavyweights XRP and Solana.
“We’ll know for sure in a couple of weeks if this has a legit shot at getting approved,” said Seyffart. “Litecoin might have a better shot — largely because of a lack of accusations that Litecoin is a security from the SEC.”
The new applications come as Donald Trump’s second term in the White House is expected to fuel a new crypto rally and fulfill the industry-friendly pledges he made during the campaign.
Altcoin ETF race
A key factor in ETF approval for cryptocurrencies has historically been the existence of a regulated futures market.
“Bitcoin and Ether both had liquid, regulated futures markets for several years before the SEC approved spot ETF applications for these assets,” Sui Chung, CEO of CF Benchmarks, told DL News.
Litecoin, however, lacks the same level of futures market development, which could complicate approval.
“Litecoin has similarities to Bitcoin that probably make it logical to be approved if the new commission moves beyond the surveillance sharing stuff with CME futures markets,” said Kaiko analyst Adam Morgan McCarthy.
In the meantime, speculators have started to load up on Litecoin, pushing the price to a three-year high of $140. It’s now the 23rd most valuable crypto with a market value of $10.3 billion.
Solana and XRP contenders
Fund managers have also applied to launch Solana and XRP ETFs. Analysts expect both to eventually clear the SEC despite concerns of investor interest.
“Over the coming few months, we do believe that the bar for accepting new crypto ETFs will be lowered, and think 2025 will see both a SOL and XRP ETF approved,” said Edouard Hindi, chief investment officer at Tyr Capital.
Solana ETFs, filed by major players like Bitwise, VanEck, and 21Shares, are facing delays at the moment, with the SEC expected to push decisions until at least March.
XRP ETFs, too, are awaiting clarity, as Ripple’s legal skirmish with the SEC over its security status looms in the background.
Despite these hurdles, expectations for capital inflows are high.
JPMorgan analysts estimate that Solana ETFs could attract between $3 billion and $6 billion, while XRP ETFs might draw as much as $8 billion.
Yet these figures pale compared to Bitcoin and Ethereum ETFs, which pulled in $107 billion and $12 billion, respectively, in 2024.
Crypto market movers
- Bitcoin is up 3.8% over the last 24 hours to trade at $102,815.
- Ethereum is up 2.4% in the same period to $3,415.
What we’re reading
- Coinbase launches DeFi-backed Bitcoin loans for US users — and says this time it’s different ― DL News
- Ai16z’s humanoid robot ― Milk Road
- Likely False Rumors of Altcoin Reserve Send XRP and SOL Prices Soaring ― Unchained
- Bitcoin’s ‘Coinbase Premium’ Muted Amid Reports Trump Plans to Designate Crypto a National Policy ― CoinDesk
- Gary Gensler’s last trick ― Milk Road
Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.