SEC Likely to Approve Litecoin (LTC) ETF With 90% Chance

The US Securities and Exchange Commission nears a decision on a spot Litecoin ETF. Bloomberg ETF analysts James Seyffart and Eric Balchunas assign a 90% chance for approval for Litecoin ETF later this year 2025. This prospect outshines other crypto ETF proposals such as XRP at 65%, Solana at 70%, and Dogecoin at 75%. Investor interest grows as digital assets capture more attention and funds and the market eagerly awaits further developments as fund inflows continue to climb.

List of candidate crypto ETFs vying for SEC approval. Source: James Seyffart

• Litecoin ETF holds a 90% approval chance while XRP sits at 65%, Solana at 70%, and DOGE at 75% according to Bloomberg ETF analysts.

• Bloomberg ETF analysts say that the SEC acknowledged Litecoin regulatory filings and now likely views Litecoin as a commodity.

• The crypto ETF surge in 2025: the spot Bitcoin ETF received $40.7B in inflows and the Ether ETF received $3.18B.

• Companies may launch a Litecoin ETF with as little as $50M.

Read more: Litecoin (LTC) Price Rallies 12% as Canary Litecoin ETF Filing Gains SEC Recognition

Source: KuCoin

Litecoin (LTC) launched in 2011 as a faster alternative to Bitcoin. It processes blocks every 2.5 minutes and uses a proof-of-work system similar to Bitcoin's. Today, Litecoin trades at $130.13 and has a capped supply of 84M LTC. Its design targets faster transactions and lower fees compared to Bitcoin which currently trades at $98,258. Litecoin serves as a testing ground for new innovations in digital payments and blockchain technology. The token's technical attributes and established filing process strengthen its appeal to both regulators and investors. As a result, LTC plays a key role in the digital asset ecosystem.

Read more: How to Mine Litecoins: The Ultimate Guide to Litecoin Mining

Bloomberg ETF analysts see a clear path for the Litecoin ETF. They expect the US regulator to approve a spot Litecoin ETF before the end of the year. Filing forms S-1 and 19b-4 have already been submitted and acknowledged by the SEC. This progress signals that the regulator views Litecoin as a commodity. As a result, Litecoin gains an advantage over other crypto ETFs and positions itself strongly for a 2025 launch.

Investor demand for crypto ETFs grows as market dynamics evolve. The spot Bitcoin ETF received $40.7B in net inflows and the Ether ETF received $3.18B. These impressive figures show that investors seek exposure to digital assets. In addition, analysts believe that a Litecoin ETF need not generate massive flows to be successful. Fund companies can launch the ETF with as little as $50M. Seyffart explained that hitting high flows is not a prerequisite for success from an issuer perspective:

“You will probably see a long tail of ETFs holding digital assets in the long run and the ones that don't garner interest or flows will simply liquidate.”

Grayscale’s LTC holdings over the past year. Source: CoinGlass

As speculation over a Litecoin ETF approval grows, major institutional investors have been increasing their exposure to LTC. Grayscale has aggressively expanded its Litecoin holdings, growing from 1.4 million LTC in February 2024 to over 2.1 million LTC by January 2025. This accumulation suggests heightened institutional confidence in Litecoin’s long-term value.

Meanwhile, asset manager Monochrome has submitted an application for a Litecoin ETF (LTCC) in Australia, which, if approved, would provide regulated access to Litecoin for Australian investors. This development highlights growing global demand for regulated Litecoin investment products.

Approval Timeline and Future Proposals

The SEC decision process is active and evolving. Analysts predict that the Litecoin ETF may launch soon based on its advanced filing process. Additional filings have been submitted for candidate crypto ETFs such as Hedera and Polkadot. Hedera trades at $0.2427 while Polkadot trades at $5.17. This trend suggests that more ETF proposals will soon hit the market. Seyffart noted that issuers plan to experiment with many offerings to see which ones succeed. He remarked, "Issuers will try to launch many many different things and see what sticks." He further added that a long tail of ETFs will eventually emerge as unsuccessful products simply liquidate.

Source: James Seyffart

Regulatory challenges remain for the XRP and Solana ETFs. The XRP ETF faces delays until the SEC lawsuit against Ripple is fully resolved. In one ruling, XRP was not deemed a security on secondary markets. However, the SEC appealed the decision and claimed that Ripple breached securities laws when selling XRP to retail investors. Ripple now hopes that acting chair Mark Uyeda will withdraw the enforcement case. Meanwhile, Solana trades at $204.49 and its security status must be resolved before the SEC can review it under a commodities ETF wrapper. These challenges highlight the varying paths different crypto ETFs must navigate.

The outlook for a Litecoin ETF remains very strong. Bloomberg ETF analysts assign a 90% chance of approval as the SEC moves forward with its decision process. The advanced filing process and robust market inflows support this optimism. As more ETF proposals enter the market, investors will watch the space closely. The evolving crypto landscape presents clear opportunities for those seeking exposure to digital assets. This dynamic environment promises new ways for investors to participate in the future of finance.