Bloomberg analyst: The probability of Litecoin ETF being approved this year is 90%

Author: Brayden Lindrea, CoinTelegraph; Translated by: Wuzhu, Golden Finance

Bloomberg Exchange Traded Fund (ETF) analysts predict that U.S. securities regulators are 90% likely to approve spot Litecoin ETFs by the end of this year.

Bloomberg's James Seyffart and Eric Balchunas believe that Litecoin is more likely to be approved in 2025 than other ETFs currently proposed, including spot XRP, SOl, Dogecoin ETFs - they believe that the probability of approval of these ETFs is 65% respectively. , 70% and 75%.

Litecoin was born in 2011 as a faster alternative to Bitcoin, and it adopts a similar proof-of-work consensus mechanism to Bitcoin.

The two posted on X that the path to Litecoin to get SEC approval is probably the most direct, as Forms S-1 and 19b-4 have been filed and recognized, and the SEC may also consider it as A commodity.

Compete for the list of candidate crypto ETFs approved by the SEC. Source: James Seyffart

Farside Investors data shows that competition among cryptocurrency ETFs is intensifying with strong demand for spot Bitcoin and Ethereum ETFs. Since its launch in January and July 2024, the net inflows of the two ETFs reached US$40.7 billion and US$3.18 billion, respectively.

While Seyffart believes Litecoin ETFs won’t attract as much demand, he said that in some cases it’s still worth it for a fund company with only $50 million in funding.

“From the issuer’s perspective, they don’t have to have great success in liquidity, they can get value.”

Seyffart's chart shows that the deadline for the SEC to make decisions on Litecoin, Solana, XRP and Dogecoin ETF is October 2-October 18. Seyffart said the Litecoin ETF could be launched before that.

Seyffart and Balchunas also acknowledged that Canary Capital and 21Shares have submitted Hedera and Polkadot's ETFs, but no approval probability has been announced as of this writing.

More cryptocurrency ETF applications are expected

Seyffart said there could be more cryptocurrency ETFs being proposed.

“The issuer will try to launch a lot of different things and see which ones will succeed,” Seyffart said.

“In the long run, you might see a large number of ETFs holding digital assets, and those that have not received interest or flow of funds will be liquidated.”

Balchunas noted that before U.S. President Donald Trump won the U.S. election on November 5, 2024, all these cryptocurrency ETFs (except Litecoin) had a less than 5% chance of winning.

XRP and Solana still need to be completed

Meanwhile, the security status of Solana and XRP remains questionable, and Seyffart predicts that the XRP ETF will not be approved until the SEC’s lawsuit against Ripple is completely resolved.

In August 2023, Ripple achieved partial victory when it ruled that XRP was not a securities when it was sold on the secondary market - however, the SEC appealed the judgment, claiming that Ripple violated the Securities Act when selling XRP to retail investors .

However, these actions were taken under the SEC led by Gary Gensler, and Ripple now hopes that the new SEC leadership led by Acting Chairman Mark Uyeda will be able to withdraw the enforcement case.

Seyffart said last month that Solana's security status also needs to be resolved before the SEC can analyze Solana under "Commodity ETF Package".