Canary Capital’s Litecoin ETF filing adds another contender to the race, but will the SEC’s new leadership give LTC an advantage over Solana and XRP?
Litecoin joins the ETF race
The crypto ETF race in the United States may have a new competitor, and this time it’s Litecoin (LTC).
On January 16, Canary Capital, a digital asset and crypto fund management company, filed an amended Form S-1 for a proposed Litecoin exchange-traded fund. Bloomberg ETF analyst James Seyffart shared the update on X.
An amended S-1 filing indicates that the issuer is actively responding to regulatory concerns, often incorporating comments from the Securities and Exchange Commission. While this does not guarantee approval, it suggests ongoing discussions with regulators.
However, the most crucial step – the 19b-4 filing – is still missing, meaning the official clock for SEC approval or denial has not yet started.
“This bodes well for our prediction that Litecoin will likely be the next coin approved,” said Eric Balchunas, an analyst at Bloomberg ETF, but he also noted that impending changes in SEC leadership remain a “huge variable “.
As a reminder, ETFs allow investors to gain exposure to assets such as cryptocurrencies without owning them directly. If approved, the Litecoin ETF could become the third crypto ETF in the United States, after Bitcoin (BTC) and Ethereum (ETH).
The market seems to be reacting to these rumors. The price of LTC surged more than 16% in the last 24 hours on January 16, reaching $117.92, making it the fourth biggest gainer among the top 100 cryptos by market cap.
According to on-chain analytics firm Santiment, this rally is fueled by “whales” – large investors holding at least 10,000 LTC – who have added 250,000 coins since January 9.
Santiment also noted that “Litecoin has decoupled from other altcoins,” hinting that the momentum may be more than temporary.
Solana and XRP lead the way
The crypto ETF race in the United States is heating up, and although Litecoin has entered the fray, Solana (SOL) appears to be further along in the process.
At least five major companies – VanEck, Grayscale, 21Shares, Bitwise and Canary Capital – filed Forms 19b-4 for Solana spot ETFs as early as November, moving those applications to formal review by the SEC. This puts Solana ahead of Litecoin in the potential approval timeline.
The deadlines for these applications are fast approaching. Grayscale’s Solana ETF is first in line, with a response expected by January 23.
The remaining four issuers, including VanEck and Bitwise, will face preliminary rulings by Jan. 25, 45 days after the SEC begins its formal review.
However, approval is far from guaranteed. The SEC has historically been cautious of spot crypto ETFs, particularly for assets that lack a robust, regulated futures market.
Under the leadership of Gary Gensler, the agency maintained that no spot crypto ETF would be approved unless there was a regulated, highly correlated futures market for the asset.
Bitcoin and Ethereum have met this requirement through their futures markets on the Chicago Mercantile Exchange, but Solana does not yet have this infrastructure.
Meanwhile, the race for a spot in the Ripple ETF (XRP) is also heating up. Four companies – WisdomTree, Bitwise, 21Shares and Canary Capital – submitted applications, with WisdomTree’s filing requiring a response from the SEC by January 16.
The stakes are high. Banking giant JPMorgan estimates that the Solana and XRP ETFs alone could raise up to $14 billion in their first year. VanEck’s Matthew Sigel shared JPMorgan’s X predictions.
For Solana specifically, projections suggest an influx of $3 billion to $6 billion. XRP, on the other hand, could potentially attract between $4 billion and $8 billion.
Balchunas commented on the projections, noting that while his team has yet to make formal forecasts, JPMorgan’s estimates appear reasonable.
The question remains whether Solana or XRP manages to clear the SEC barriers first – or whether Litecoin takes a leap forward.
Gensler out, Atkins in: what this means for crypto ETFs
The crypto industry is on the cusp of a major regulatory overhaul as SEC leaders prepare for a complete overhaul.
On January 20, outgoing SEC Chairman Gary Gensler, known for his aggressive stance on crypto regulation, will resign.
Gensler’s departure coincides with the inauguration of Donald Trump as the 47th president of the United States, ushering in a new chapter for the SEC under the leadership of Paul Atkins, Trump’s pick for president.
Atkins, a former SEC commissioner, is widely considered a pro-crypto figure. His approach is expected to stand in stark contrast to Gensler’s strict mandate, during which the SEC brought more than 80 actions against crypto companies, often alleging that various tokens were unregistered securities.
While Gensler’s supporters argue these actions were necessary to combat fraud and manipulation, critics say his approach stifled innovation and created an atmosphere of regulatory uncertainty.
The new leaders, however, seem ready to adopt a more balanced approach. Atkins is expected to work closely with Republican SEC Commissioners Hester Peirce and Mark Uyeda, both of whom have been vocal critics of Gensler’s policies.
One of the most crucial changes concerns the SEC’s plan to freeze or even withdraw enforcement actions that do not involve allegations of fraud. If implemented, the move would mark a dramatic shift from Gensler’s aggressive crackdown, offering the industry a chance to rebuild trust with regulators.
Therefore, the stakes are particularly high for the future of crypto ETFs, an industry that could see accelerated approvals under new SEC leadership.
With Litecoin, Solana, and XRP ETFs already vying for regulatory approval, the industry is closely watching whether Atkins will pave the way for a more welcoming environment.
