Canary Litecoin ETF Takes Key Step Toward SEC Approval

• The SEC acknowledges Canary Litecoin ETF’s 19b-4 filing, opening a public comment period.
• Nasdaq seeks approval to list and trade the first Litecoin spot ETF in the U.S. market.
• Analysts watch if the SEC accelerates approval or takes the full 240-day review period.

The U.S. Securities and Exchange Commission (SEC) has acknowledged the 19b-4 filing for the Canary Litecoin ETF. This marks a significant step in the potential approval process for a spot Litecoin exchange-traded fund (ETF). The proposal, submitted by Nasdaq, seeks regulatory approval to list and trade shares of the Canary Litecoin ETF under Nasdaq Rule 5711(d). This development makes it the first altcoin ETF application to move forward after other applications were reportedly advised to withdraw.

The SEC has established a public comment period to review their newly proposed rule. Those interested have 21 days beginning from the official publication date in the Federal Register to provide their opinions. Analysts track the regulatory process with interest as the SEC typically requires at least 240 days to approve new ETF applications. The SEC’s exact timeframe for approval remains uncertain but some industry experts believe that the agency could make a decision sooner.

James Seyffart, an ETF analyst, confirmed the SEC’s acknowledgment of the filing. He noted that this was an expected step but an important milestone in the review process. Bloomberg ETF analyst Eric Balchunas pointed out that this is the first altcoin ETF to reach this stage under the current SEC leadership. He added that previous applications were withdrawn after guidance from SEC Chair Gary Gensler’s regulatory team. The Canary Litecoin ETF filing, however, has continued progressing.

The full SEC filing outlines the proposed structure of the Canary Litecoin ETF. The ETF aims to provide investors with exposure to Litecoin without requiring direct ownership of the cryptocurrency. It would function similarly to recently approved spot Bitcoin ETFs, allowing investors to trade shares on traditional stock exchanges. The filing also details compliance measures and market safeguards designed to address potential regulatory concerns.

Related: CoinShares, Grayscale File for XRP, Litecoin, Solana ETFs

Canary Funds, the firm behind the ETF has pointed out the rising market demand for regulated crypto investment options. The firm suggests that Litecoin qualifies well for ETF approval due to its established market presence along with its Bitcoin-like characteristics. If authorized by regulatory bodies the Canary Litecoin ETF would create another investment choice for cryptocurrency exposure within a regulated framework.

The SEC’s acknowledgment of the filing marks an important step, but the final outcome remains uncertain. The agency will evaluate market conditions, regulatory risks, and investor protections before making a decision.

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