In 2025, analysts estimate the chances of a Litecoin (LTC) exchange-traded fund (ETF) being approved by the US Securities and Exchange Commission (SEC) at 90%. This conclusion is based on a number of factors that make LTC a more suitable candidate for an ETF compared to other cryptocurrencies.
Why Litecoin Might Get ETF Approval?
Structural similarity to Bitcoin
Litecoin is a fork of Bitcoin and uses a similar Proof-of-Work (PoW) mechanism, making it more predictable for regulators. The SEC has already approved a Bitcoin ETF on the spot market, setting a precedent for other similar assets.
No risk of being recognized as a security
The SEC looks at many cryptocurrencies through the lens of the Howey Test to determine whether they are securities. In the case of Litecoin, there are no such claims, which reduces regulatory risk.
Growing interest from institutional investors
The approval of the ETF will simplify access to Litecoin for large funds and private investors, which will increase the liquidity of the asset. There are already known cases of applications for the creation of an ETF based on LTC.
How will this affect the price of Litecoin?
Historically, the launch of an ETF has led to a significant increase in the value of the underlying asset. For example, after the approval of the Bitcoin ETF in January 2024, BTC reached new price highs. If the Litecoin ETF is approved, similar dynamics can be expected.
According to current forecasts:
Conservative scenario: LTC may reach $250-$300 in 2025.
Optimistic scenario: In case of panic demand and an influx of institutional money, the rate may exceed $500.
Aggressive Forecast: With a strong bull market and support from major players, the LTC price may exceed $700–$1000.
What conclusions can be drawn!?
If the SEC does approve a Litecoin ETF in 2025, it will be a major milestone for the entire crypto industry. LTC will receive an additional boost to growth, and its liquidity and availability in traditional markets will increase significantly. However, the final decision remains with the regulator, and investors should consider the possible risks.