Litecoin’s price surged on January 30 as expectations grew that the Securities and Exchange Commission will approve a spot ETF.
Litecoin (LTC) jumped more than 12%, reaching an intraday high of $135. It has now soared 165% from its lowest point in 2024.
Polymarket odds of a spot LTC ETF approval rose to 86%, signaling that most participants expect the approval to happen later this year. These odds increased after the SEC acknowledged Canary’s LTC ETF application and opened it for public comment.
The SEC is expected to approve the fund because Litecoin is similar to Bitcoin (BTC). It is a Bitcoin hard fork, with the primary difference being its maximum supply as Litecoin has a limit of 84 million coins, while Bitcoin is capped at 21 million.
Litecoin’s price will likely rise ahead of the ETF approval as traders anticipate increased institutional demand.
However, there is a risk that Litecoin’s ETF will see limited interest from institutional investors. Current data shows that most institutions remain focused on spot Bitcoin ETFs. According to SoSoValue data, spot Bitcoin ETFs have accumulated nearly $92 billion in inflows, bringing total assets under management to $121 billion. The iShares Bitcoin ETF alone holds almost $60 billion in assets.
On the other hand, Ethereum (ETH) ETFs have seen cumulative inflows of $2.66 billion and now hold $11.8 billion in assets. Before its conversion into an ETF, the Grayscale Ethereum Trust had nearly $10 billion in assets. This trend suggests that institutional investors are primarily interested in Bitcoin funds. As a smaller and less widely adopted cryptocurrency, Litecoin’s ETF demand is likely to be modest.
Litecoin price analysis
The weekly chart shows that LTC’s price has been consolidating over the past few weeks. It remains slightly above the key support level at $115.15, which was the highest swing in May 2023 and April 2024. This price level also aligns with the upper boundary of the ascending triangle pattern and the 23.6% Fibonacci retracement level.
Litecoin has entered the second phase of the Elliott Wave formation. The upcoming third wave is typically the longest and could push LTC toward the 61.8% retracement level at $271.45, representing a potential 100% gain from current levels.
However, the bullish outlook will be invalidated if Litecoin’s price drops below the psychological support level of $100.
