The fate of Canary Capital’s spot Litecoin exchange-traded fund hangs in the balance after the US Securities and Exchange Commission failed to take action by the original decision deadline on Thursday.
This inaction has created uncertainty within the crypto community regarding the SEC’s operations in light of a potential federal government shutdown and the implications of new generic listing standards on the timelines for numerous crypto ETF applications waiting for approval.
Bloomberg ETF analyst James Seyffart and FOX News reporter Eleanor Terrett pointed out that the previous 19b-4 deadlines for crypto ETF applications may now be obsolete, as the SEC has advised applicants to withdraw them, leaving only the S-1 registration statement requiring regulatory approval.
Compounding the situation is another layer of uncertainty tied to the government shutdown.
In August, the SEC announced an “Operation Plan” for a government shutdown, indicating it would “not review and approve applications for registration.” This includes new financial products, changes to self-regulatory organization rules, and the review or acceleration of registration statement effectiveness.
It remains unclear if the SEC’s lack of response regarding Canary’s spot Litecoin ETF is solely a result of the government shutdown, or if it is also influenced by the new generic listing standards, which would make the 19b-4 deadline irrelevant.
Canary withdrew its 19b-4 last week, complicating the matter
Canary withdrew its 19b-4 application on September 25 at the SEC’s request, which may have contributed to the SEC’s inaction on Thursday. The impact of the 19b-4 withdrawals on applicants who have not rescinded that document is uncertain.
— Litecoin (@litecoin) October 2, 2025
Cointelegraph reached out to the SEC and Canary for comments, but did not receive an immediate response.
SEC still open, but in limited capacity
In response to the government shutdown on Wednesday, the SEC announced it would continue operations with a “very limited” number of staff members available.
The SEC confirmed that its Electronic Data Gathering, Analysis and Retrieval (EDGAR) database would remain operational.
Altcoins look to add to $75 billion spot crypto ETF market in US
The market anticipates the potential approval of several new spot crypto ETFs—including Litecoin (LTC), Solana (SOL), XRP, Avalanche (AVAX), Cardano (ADA), Chainlink (LINK), and Dogecoin (DOGE).
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Any approval would contribute to the existing US spot Bitcoin (BTC) and Ether (ETH) ETFs, which have garnered $61.3 billion and $13.4 billion in inflows since their launch last year.
Despite the challenges, Bloomberg ETF analyst Eric Balchunas mentioned on Monday that the SEC’s new listing standards have elevated the likelihood of some spot crypto ETF approvals to 100%.
The new listing standards are expected to facilitate the process under Rule 6c-11, significantly shortening approval timelines that usually span up to 240 days.
SEC Chair Paul Atkins stated that the new listing standards will lower barriers to accessing digital asset products and provide investors with more choices.
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