The SEC has paused a decision on Canary Capital’s proposed litecoin ETF, following a wave of similar freezes in recent weeks for XRP, solana, and dogecoin-based ETFs, among others. This follows the SEC’s designation in March of a longer period in which to review a rule change that would list a litecoin ETF on the NASDAQ.

Concurrent with the pause, the SEC sought public comment on whether the listing and trading of the ETFs “is designed to prevent fraudulent and manipulative acts,” or “raises any new or novel concerns not previously contemplated by the Commission.”

Bitcoinsensus noted that these pauses could be indicative of a deferral until a crypto regulatory framework is produced by the Crypto Task Force, led by SEC Commissioner Hester Peirce.

Decentralized peer-to-peer payment system

Litecoin is a decentralized peer-to-peer payment system like Bitcoin, only with a different mining algorithm. Its native token LTC has a market cap of $6.6 billion and currently trades at $84.

ETFs replicate the performance of a bundle of assets, letting investors capitalize on crypto without actually holding the asset. This can provide security for a sector rife with scammers and security vulnerabilities.

Bitcoin-based spot ETFs have previously won SEC approval, with 11 approved in January 2024, including those from BlackRock, Vanguard, Fidelity, and Invesco, which ultimately brought in billions in capital inflow. That was followed by another approval for ether ETFs in July of that year.

But now the tide of wider crypto ETF approvals seems to have turned after the appointment of the current SEC Chair Paul Atkins. In January, senior Bloomberg ETF analyst Eric Balchunas predicted that a litecoin ETF was imminent, but with the next SEC chair as a “huge variable.”