Canary Capital, a Nashville-based asset management company, has filed an S-1 Form for its Litecoin (LTC) exchange-traded fund (ETF) with the U.S. government. U.S. Securities and Exchange Commission (SEC) on October 15th.
Canary's filing is the first for a Litecoin-linked spot ETF in the U.S., and comes less than a week after the asset manager's XRP ETF. filing October 8th.
Canary Capital CEO and Founder Steven McClurg was previously Chief Investment Officer of Valkyrie Investments and co-founded the asset management firm with Leah Wald.
This is different from the Solana ETF application.
Alex Thorne, head of research at Galaxy Digital, told CryptoSlate. Litecoin is generally considered to have had a “fair launch”, meaning there was no pre-mining or token sale.
Furthermore, since Litecoin is based on a proof-of-work consensus model, no entity would offer LTC to public or private investors. Mr Thorne added:
“While the SEC has not taken a position on this issue, it is unlikely that Litecoin would be considered offered as a security because it was not offered at all. We should have a pathway to launch a spot-based Litecoin ETF in the US, just like we did with Coin.”
Thorne said the same cannot be said for the Spot Solana ETF because the blockchain is based on a proof-of-stake consensus algorithm and conducts token sales.
Thorne said this makes Solana’s initial starting fact pattern different from Bitcoin and Litecoin. Additionally, the SEC is currently claiming in its lawsuit against Coinbase that SOL is a “cryptoasset security.”
Mr Thorne said:
“(This is) why some analysts suggest that the SOL ETF filing is betting on Trump winning in November. “This is likely to require a change in the SEC's approach to classification.”
A market dominated by grayscale
Bloomberg ETF analyst James Seifert said: ETPs like CoinShares Swiss LITE ETC group's ELTC Germany already has Litecoin. Meanwhile, the US market is currently only utilized by Grayscale Litecoin Trust (LTCN).
According to a CoinShares report, LTC funds offered in Europe have a combined total assets under management (AUM) of $11.5 million, which represents less than 10% of the total AUM of Litecoin-related ETPs globally.
Meanwhile, LTCN has $127.4 million in assets under management, accounting for the remaining 93% of the funds invested in Litecoin-related ETPs worldwide.
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