Canary Capital has filed with the U.S. Securities and Exchange Commission (SEC) to list an exchange-traded fund (ETF) underpinned by Litecoin, a cryptocurrency inspired by Bitcoin.

The crypto-focused investment startup, Canary Capital, submitted paperwork to the SEC to bring a spot Litecoin ETF to Wall Street trading terminals. Launched by Valkyrie founder Steven McClurg, the firm filed documents, including a Form S-1, signaling the formal registration of securities for its spot Litecoin ETF.

Understanding Litecoin

Litecoin is one of the oldest blockchain assets and is often considered an offshoot of Bitcoin. However, Litecoin was built in 2011 as a lighter version of Bitcoin rather than an actual Bitcoin fork. Thirteen years later, Litecoin traded at almost $70 per coin and had a market cap of over $5.25 billion. The token ranked 27th among the top 100 cryptocurrencies by valuation.

Canary Capital’s Strategic Moves

Canary Capital has actively entered the crypto ETF bidding scene. Recently, the investment firm joined Bitwise in bidding for a spot ETF. On October 1, Canary Capital unveiled its inaugural private fund focused on Hedera, named the Canary HBAR Trust.

Crypto ETF Filings: A Growing Trend

Crypto ETF filings have become a regular theme at the SEC. Since January, around 11 issuers have secured approval for spot Bitcoin funds. Spot Ethereum ETFs followed in late July, sparking speculation over which cryptocurrency would be next to receive the institutional ETF wrapper.

Solana and Ripple’s native token have emerged as leading contenders for a crypto ETF after Bitcoin and Ethereum. However, the SEC’s regulatory approach and perception of which tokens fall under securities laws leaves uncertainty.

Regulatory Landscape

According to reports, SEC chair Gary Gensler told hedge funds in 2018 that Ethereum and Litecoin were not considered securities. This assertion, along with Litecoin’s similarities with Bitcoin, could improve the chances of a spot Litecoin ETF. However, SEC leadership under Gensler remains largely skeptical of the crypto economy, and the product may face pushback from agency staff.

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