The United States Securities and Exchange Commission (SEC) has once again postponed its decision on Grayscale's application to convert its Litecoin Trust into a spot exchange-traded fund (ETF). This regulatory delay has directly impacted the price of Litecoin (LTC), pushing it below the $110 mark for the first time since July 25.
The SEC's latest filing, dated July 29, extends the review period by an additional 60 days, moving the final decision deadline to October 10, 2025. This move dashes earlier community expectations for a potential authorization by August. The Litecoin Foundation confirmed the delay via social media, noting the new deadline.
Grayscale's proposal to list shares of the Grayscale Litecoin Trust on the NYSE Arca was initially filed earlier this year and amended in February before entering the Federal Register. The trust is seen as a crucial gateway for traditional investors to gain exposure to Litecoin without directly holding the digital asset, which could potentially attract significant institutional inflows and boost mainstream adoption.
While the SEC has already approved spot Bitcoin and Ethereum ETFs, the path for a Litecoin ETF has been marked by greater uncertainty and a slower pace. The regulator cited a need for additional time to consider the proposed rule change. This pattern of delay is familiar to the crypto industry; the SEC has previously authorized and then declined similar products, such as Bitwise's crypto ETF conversion, reflecting ongoing regulatory skepticism.
The immediate market reaction was negative, with LTC's price falling to an intraday low of $107 and trading around $108 at the time of reporting. Analysts note that declining daily trading volumes and a bearish MACD crossover on shorter timeframes signal weakened near-term momentum. However, some market observers, like analyst Ali Martinez, suggest that if Litecoin can stabilize and hold above the $108 support level, it could gather upside momentum for a rebound toward the $115 to $120 range.
