The U.S. Securities and Exchange Commission (SEC) has extended its review of Canary Funds’ proposal to list a spot Litecoin (LTC) exchange-traded fund (ETF), inviting public feedback on the matter. The regulator is seeking input on whether the proposed product adequately addresses concerns about market manipulation and fraud.
In a notice published Monday, the SEC called for comments on any novel risks or issues posed by a Litecoin ETF that may not have been previously considered. The move underscores the agency’s cautious approach to digital asset-based financial products.
The delay is part of a broader pattern of postponed decisions involving similar crypto-related ETFs. Just last week, the SEC also deferred action on ETF applications linked to XRP, Hedera, and Dogecoin, citing the need for further analysis and stakeholder input.
Despite the regulatory slowdowns, sentiment within the crypto community remains hopeful. Since President Donald Trump’s return to office earlier this year, the SEC has adopted a more crypto-friendly tone. Several enforcement actions have been dropped, and public discussions have been initiated to help shape the legal framework for digital assets.
New SEC Chair Paul Atkins has expressed support for the growth of the crypto sector, describing its potential benefits as “enormous.” He has also emphasized a willingness to collaborate with lawmakers on building a robust and coherent regulatory environment.
According to Bloomberg ETF analyst James Seyffart, the Litecoin ETF proposal may be the front-runner among pending applications. “If any asset has a chance of early approval, it’s Litecoin, in my opinion,” Seyffart stated on X (formerly Twitter).
As competition heats up, Canary Funds faces rival bids from firms like Grayscale and CoinShares, each aiming to bring the first Litecoin ETF to market. For now, the decision remains in limbo as the SEC evaluates public responses.
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