Analysts Say SEC Views LTC as Commodity

• Analysts predict a 90% chance of SEC approval for a Litecoin ETF by 2025 because it is likely considered a commodity.
• Other crypto ETFs, such as XRP and Solana, face regulatory hurdles, but more filings are expected as the market evolves.

Bloomberg ETF analysts James Seyffart and Eric Balchunas predict that the U.S. Securities and Exchange Commission (SEC) will definitely greenlight spot Litecoin exchange-traded funds (ETFs) before the year 2025 concludes. The SEC indicates through spot ETF application approvals that Litecoin has a better chance than XRP, Solana, and Dogecoin, at 65%, 70%, and 75%, respectively.

The development of Litecoin as a faster alternative to Bitcoin occurred in 2011. The framework functions through a proof-of-work mechanism that uses Bitcoin-like authentication systems. The regulatory pathway for Litecoin stands in better shape because the SEC indicates It belongs to the commodity category. Bloomberg analysts highlight that regulatory documents S-1 and 19b-4 have been filed to support the SEC’s evaluation of Litecoin.

Our official alt coin ETF approval odds are out. Litecoin leads w 90% chance, then Doge, followed by Solana and XRP. We are only doing for 33 Act $IBIT-esque filings. But def poss to see futures or Cayman-subsidiary type 40 Act stuff get through as well. https://t.co/JSaNnifjbu

— Eric Balchunas (@EricBalchunas) February 10, 2025

How Market Demand Could Shape Litecoin ETF Success

Consultants predict that Litecoin Exchange-Traded Funds would obtain minimal market interest compared to Bitcoin or Ether Exchange-Traded Funds. According to Seyffart, any fund issuance company would consider a Litecoin ETF valuable even if its initial capital total remained below $50 million. From January until July 2024, Farside Investors demonstrated that Bitcoin and Ether ETFs collected more than $43.88 billion from ongoing net inflows throughout their initial release period.

The SEC needs to finalize its decision about Litecoin, Solana, XRP, and Dogecoin crypto ETF applications between October 2 and October 18. According to Seyffart, the regulatory climate appears supportive of introducing a Litecoin exchange-traded fund before the current mandatory timeline ends.

XRP and Solana must face ongoing regulatory questions about their proposed ETFs. XRP’s status as a security remains unresolved because the SEC filed an appeal after a court ruled it impossible to classify XRP sold on secondary markets as a security. The SEC, under acting Chair Mark Uyeda, now oversees the case that former Chair Gary Gensler began. This development brings optimism for the possible dismissal of the enforcement action.

The necessary clarification of Solana’s classification prevents the SEC from evaluating it according to possible commodities ETF assessment methods. The approval process for XRP and Solana ETFs remains uncertain because unresolved classification matters remain outstanding.

Emerging Crypto Assets Targeted for Future ETF Filings

According to market analysts, U.S.-based ETF issuers plan to file various cryptocurrency-focused ETFs throughout the following months. Seyffart explained the strategy as submitting numerous ETF proposals to find out what succeeds. Balchunas predicted that before the 2024 political changes, approval chances for crypto ETFs beyond Litecoin were unlikely to reach above 5%.

It’s our view. That until that WHOLE mess of litigation between Ripple/XRP and the SEC is settled and/or finished or has some sort of expected outcome etc etc — you likely won’t see an ETF. The SEC needs to untangle that mess.

— James Seyffart (@JSeyff) February 10, 2025

The financial firms Canary Capital and 21Shares submitted ETF application proposals for both Hedera and Polkadot assets. There are no available approval odds for the submitted filings. Market analysts anticipate progress in the crypto ETF sector as regulatory guidelines adapt further.

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