US SEC Opens Public Comment Period for Grayscale’s Litecoin ETF Proposal
Key Highlights:
- The SEC has invited public comments on Grayscale’s Litecoin ETF proposal, with a 21-day submission window following Federal Register publication.
- NYSE Arca’s 19b-4 filing includes applications for both Litecoin and Solana Trusts in the ETF approval process.
- Acting SEC Chair Mark Uyeda has appointed Hester Peirce to lead a crypto task force following Gary Gensler’s departure.
The U.S. Securities and Exchange Commission (SEC) has acknowledged NYSE Arca’s 19b-4 filing submitted on behalf of Grayscale, signaling a step forward in the process of converting Grayscale’s Litecoin Trust into an exchange-traded product (ETP). As part of the regulatory review, the SEC has opened a public comment period, allowing stakeholders to submit their opinions within 21 days of its publication in the Federal Register.
SEC Reviews Grayscale’s Litecoin ETF Filing
NYSE Arca’s 19b-4 filing is a crucial part of the SEC’s review process for crypto-based ETFs. Alongside the Litecoin Trust, the filing also covers Grayscale’s Solana Trust. The SEC’s decision will determine whether to approve, reject, or initiate further proceedings on the proposed ETFs.
The move follows a broader industry trend where top asset managers are pushing for increased crypto ETF offerings. In addition to Grayscale’s filing for a Litecoin ETF, CoinShares has submitted an S-1 application for an LTC ETF. These developments could significantly impact the future of Litecoin investment products in the U.S.
Growing Crypto ETF Filings Amid SEC Leadership Changes
The SEC’s ongoing review of multiple crypto-based ETFs comes at a time of leadership transition within the agency. Following Gary Gensler’s departure, acting SEC Chair Mark Uyeda has appointed Commissioner Hester Peirce to lead a crypto task force, focusing on improving the regulatory framework for digital assets.
In recent weeks, several firms have filed for ETFs linked to Dogecoin (DOGE) and other altcoins. Grayscale has also sought approval to convert its XRP Trust, holding $16 million in assets, into an ETF on the NYSE. This makes Grayscale the seventh asset manager to apply for an XRP ETF.
The Future of Crypto ETFs and Market Regulations
The SEC’s approval of a Spot Bitcoin ETF in January 2024 and subsequent approval of Ethereum ETFs marked a shift in the regulatory stance on crypto investment products. Investors now anticipate that the Grayscale Litecoin ETF review could lead to broader acceptance of altcoin-based ETFs.
As part of its evaluation process, the SEC will assess market risks, investor protection measures, and compliance with securities regulations before making a final decision on Grayscale’s Litecoin Trust conversion. The outcome could either grant approval, deny the request, or extend the review period for further examination.
Meanwhile, Grayscale has also introduced a Dogecoin Trust, allowing institutional investors exposure to DOGE. This move has fueled speculation about a potential Dogecoin ETF filing in the near future, further expanding the range of cryptocurrency investment options available in the market.
