According to analysis from ETF analysts Eric Balchunas and James Seyffart, a Litecoin or Hedera ETF is more likely to win SEC approval earlier than Solana or XRP.
The pair also claimed that a BTC/ETH combination ETF is even closer to approval.
Odds of a Litecoin ETF
Balchunas made this bold prediction on a social media post, referencing an exclusive article from fellow ETF analyst James Seyffart. The pair recently predicted that MicroStrategy would enter the NASDAQ 100, which quickly came true. Industry analysts typically expect that Solana ETFs are likely to receive approval soon, but Balchunas bucked the trend:
“We expect a wave of cryptocurrency ETFs next year, albeit not all at once. First out is likely the BTC + ETH combo ETFs, then probably Litecoin (because its a fork of BTC, [therefore it’s a] commodity), then HBAR (because it’s not labeled a security) and then XRP/Solana (which have been labeled securities in pending lawsuits),” he claimed.
Seyffart noted in his own writings that Solana ETFs received a direct rejection from the SEC in December. Therefore, the Commission will not consider new applicants until the next administration. After President-elect Trump’s inauguration, the SEC will likely become friendlier, but there are no guarantees it will revisit these applications.
Instead, the analysts point to Hashdex’s combination BTC/ETH ETF, which has suffered delays without an outright rejection. Both of its constituent assets already have their own ETF, so a joint product is certainly plausible.
However, they claim that the next most likely ETF is Litecoin, which has been performing rather well throughout the bull market.
The analysts pointed out that Litecoin is a fork of Bitcoin, which may make it eligible for an ETF under the same guidelines. Unlike most cryptoassets, the SEC regards BTC as a commodity and may apply a similar rationale to LTC.
Following this news, Litecoin jumped nearly 8% on the day. The pair also anticipated a possible Hedera ETF; so far, Canary Capital has applied for both this and a Litecoin offering.
Ultimately, the approval odds are disconnected from market appeal. Canary Capital is the only issuer actively seeking an LTC ETF, and there might not be enough investor demand. Still, the asset has been performing well in the bull market. If the SEC approves an ETF, Litecoin could attract newfound interest.
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