Ben Strack

Canary Capital has revealed plans to launch a litecoin-focused product just one week after filing for an ETF that would directly hold Ripple’s XRP token.



The asset manager’s proposed Canary Litecoin ETF would “hold LTC and establish its net asset value on each business day by reference to the CoinDesk Litecoin Price Index,” the Tuesday <a href="https://www.sec.gov/Archives/edgar/data/2039461/000199937124013330/litecoin-s1_101524.htm">filing</a> notes.&nbsp;



<a href="https://blockworks.co/tag/litecoin">Litecoin</a> turned 13 years old on Sunday. LTC’s market capitalization stands at nearly $5.3 billion — the 27th-highest among crypto tokens, according to CoinGecko data.&nbsp;



“As one of the longest-running blockchains with 100% uptime since its inception, litecoin has demonstrated a proven track record of security and reliability with significant enterprise-grade use cases,” a Canary spokesperson said in an email. “With its strong foundation, litecoin continues to play a leading role in the broader cryptocurrency ecosystem, which Canary believes could make it attractive to a wider range of institutional investors.”



The latest litecoin ETF proposal follows Canary’s filing to launch a ripple (XRP) offering. Fellow fund firm Bitwise <a href="https://blockworks.co/news/bitwise-files-for-spot-xrp-etf">revealed plans for a similar XRP product</a> just days earlier.&nbsp;



Read more: <a href="https://blockworks.co/news/xrp-etf-contingent-on-election-and-sec-appeal">Election outcome and SEC appeal to decide XRP ETF future</a>



Those XRP filings come after filings from VanEck and 21Shares to <a href="https://blockworks.co/news/lightspeed-newsletter-spot-solana-etf-filing">launch ETFs that would hold solana</a> (SOL) directly.



The Securities and Exchange Commission would have to approve these proposals before the ETF could launch — a process that typically takes months.&nbsp;



Though the US regulator approved spot bitcoin and ether ETFs in January and July, respectively, industry watchers have said planned products focused on crypto assets outside of BTC and ETH could face hurdles in the near-term.&nbsp;



Read more: <a href="https://blockworks.co/news/forward-guidance-newsletter-xrp-etf-filing">The XRP ETF filing: A sign of regulatory progress or wishful thinking?</a>



The <a href="https://blockworks.co/tag/sec">SEC</a>, for example, has historically wanted to first see a <a href="https://blockworks.co/news/us-spot-crypto-etf-approvals-outlook">regulated futures market</a> for a spot crypto ETF’s underlying asset — like those for bitcoin and ether. None exist for LTC, XRP or SOL.



Still, a Canary Capital spokesperson told Blockworks earlier this month that there are “encouraging signs of a more flexible regulatory environment.”



“This year’s approval of the spot Ethereum ETFs, following the earlier spot bitcoin ETF approvals, signals positive momentum, especially considering how long it took for ETH futures products to be approved,” the representative added. “We’re optimistic about the next phase of developments in the space.”



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Canary Capital plots litecoin ETF just days after XRP proposal 

Sebastian Sinclair

Litecoin has managed to eke out a milestone — processing its 180 millionth transaction — even as litecoin (<a href="https://blockworks.co/price/ltc">LTC</a>) the asset — once the second-largest crypto behind bitcoin — struggles to remain relevant in the eyes of crypto investors.



A <a href="https://x.com/LTCFoundation/status/1711388548337668462?s=20">post on X</a>, formerly Twitter, by the Litecoin Foundation celebrated the win on Tuesday, including that in 2023 alone the platform has seen over 51 million transactions, surpassing last year&#8217;s total of 39 million.



However, despite the welcomed activity, Litecoin&#8217;s financial and operational health remains in question. Data from the project&#8217;s primary <a href="https://github.com/litecoin-project/litecoin/commits/master">GitHub repository</a> shows no code commits have been conducted in the last five months.



Compounding problems, the project’s native token of the same name has witnessed a staggering decline of roughly 45% in its value since July, dropping from a local peak of $114 to its current standing at $63.



Its downward slide is a stark contrast to its soaring all-time high of $413, posted more than two years ago. The narrative of digital silver to bitcoin&#8217;s gold has lost its sheen.



Litecoin’s fee revenue further underscore the project’s tumultuous journey, which, despite processing more transactions than the previous year, has fallen considerably.



In May 2021, during the throes of the previous bull run, fees generated by Litecoin peaked at $186,000. However, as of October this year, that figure has since plummeted by 68%, settling at a modest $6,000, data from <a href="https://tokenterminal.com/terminal/projects/litecoin/financial-statement">Token Terminal</a> shows.



Such fluctuations hint at varying transaction volumes or changing user activity dynamics as the bear market continues to bite, pushing certain projects further out of the minds of investors. While the platform boasts a circulating supply of 73.5 million LTC and a market cap of $5.3 billion, up 2.2% over the last 30 days, the crypto has dropped to 15th spot, Blockworks Research <a href="https://blockworks.co/prices">shows</a>.



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Litecoin celebrates two milestones as it struggles to hold relevancy

Most people in crypto circles know the block rewards for mining bitcoin <a href="https://blockworks.co/news/anniversary-of-2016-btc-halving">will be cut in half next year</a>. Less may be aware that Litecoin&#8217;s own halving is happening much sooner.  



Like tomorrow.&nbsp;



Miners are given a certain amount of litecoin (<a href="https://blockworks.co/price/ltc">LTC</a>) when a block is produced. The reward, which started at 50 LTC per block, gets cut in half after each 840,000 that are mined — roughly every four years.&nbsp;



Currently at 12.5 LTC, the miner rewards are set to become 6.25 LTC on Wednesday.&nbsp;



Like Bitcoin, which caps its supply at 21 million <a href="https://blockworks.co/price/btc">BTC</a>, Litecoin has a limit of 84 million LTC. Roughly 87% of LTC is already in circulation.



<h2 class="wp-block-heading">Price action on the move</h2>



LTC increased by 824% in the months prior to the 2015 halving, Fineqia International research analyst Matteo Greco told Blockworks. It increased 525% in 2019 — reaching a peak seven weeks before the halving.&nbsp;



Read more: <a href="https://blockworks.co/news/bitcoin-litecoin-halvings">Halvings seem to move bitcoin and litecoin in very different ways</a>



“The next halving is scheduled for less than 24 hours from now, and if history repeats itself, this means that the 40% increase in price that LTC showed towards the end of June was probably the top price for this mid-term,” Greco said.&nbsp;



LTC reached $113 on July 3, CoinGecko data shows — its highest price since April 2022.



Litecoin’s price was $93.10 at 3 pm ET Tuesday — 4.3% higher from seven days ago and up about 0.5% in the last 24 hours.



“Litecoin&#8217;s halvings seem to be a &#8216;buy the rumor, sell the news&#8217; event on both prior occasions with a large run-up in price in the months before, and a reversal in price action after, suggesting the supply shock is priced in,” CoinShares analyst Max Shannon told Blockworks.&nbsp;



<h2 class="wp-block-heading">Impact on miners, other crypto tokens?</h2>



As rewards for mining litecoin decrease, miners could be impacted from a profit standpoint, Greco said. But, he added, this is counterbalanced by a reduction in the difficulty of mining when hash rate goes down — lowering mining costs.&nbsp;



Youwei Yang, chief economist at BIT Mining, noted that due to Litecoin’s <a href="https://www.reddit.com/r/dogecoin/comments/2ci90m/dogecoin_to_enable_auxpow_soon_all_infos_inside/">dual-mining</a> mechanism with Dogecoin, impact on miner profitability could be further mitigated. While Litecoin&#8217;s block reward is going to be halved, he added, Dogecoin&#8217;s block reward remains the same. 



“All things considered, at this stage, the halving does not have a big impact in any component and is more a narrative to create volatility and speculation used by investors and traders,” Greco said.&nbsp;



Yang said the lack of significant price movements in LTC, compared to previous halvings, comes despite current low volatility in the crypto market broadly.



“Due to its relatively small size compared to bitcoin and its unique [proof of work]-based nature with specific mining algorithms, the Litecoin halving may not have a substantial impact on bitcoin or other altcoins,” he added.  



Litecoin’s hash rate is 786 terahashes per second (TH/s) while bitcoin’s hash rate is roughly 356 exahash per second (EH/s), according to <a href="https://www.coinwarz.com/charts/network-hashrate-charts">CoinWarz</a>.



Bitcoins traded around $29,130 Tuesday afternoon, down 0.2% from a day ago.



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The Litecoin halving is hours away: Here’s what to know

David Canellis

Ask superstitious Bitcoin fans about halvings and they’ll say they’re <a href="https://blockworks.co/news/bitcoin-halvings-bull-market">outrageously bullish</a>, historically marking the onset of monumental price rallies.



What about Litecoin halvings?



Bitcoin’s fourth halving event — which will again slash <a href="https://blockworks.co/price/btc" target="_blank" rel="noreferrer noopener">BTC</a> issuance by 50% — is expected to hit this time next year. But spinoff blockchain Litecoin (<a href="https://blockworks.co/price/ltc" target="_blank" rel="noreferrer noopener">LTC</a>) will see its own halving in 100 days.



Halvings occur every four years (every 210,000 blocks for Bitcoin, 840,000 blocks for Litecoin). Bitcoin’s issuance will drop from 6.25 BTC ($171,000) per block to 3.125 BTC ($85,400), while Litecoin’s will go from 12.5 LTC ($1,100) to 6.25 ($550).



All Bitcoin and Litecoin halvings have coincided with epic bull markets. Blockworks analyzed price data starting six months before each halving and encompassing up to one year after. BTC exploded up to:



<ul class="wp-block-list">
<li>20,000% around the 2012 event;</li>



<li>560% across the 2016 halving and;</li>



<li>780% over the 2020 episode.</li>
</ul>



Most of BTC’s gains were seen almost a full year after each halving took place. Litecoin halvings have also aligned with similar bullishness, but in a very different pattern.



Unlike bitcoin’s after-the-fact rallies, LTC has pumped the hardest in the six months before its halvings occurred.



There does not appear to be a distinct pattern in LTC’s price performance in the year following each event. But the six months leading up to both halvings were eerily similar.&nbsp;



<ul class="wp-block-list">
<li>LTC peaked at about 320% gains roughly 45 days out from each halving.</li>



<li>It gave up most of those returns in the month directly after.</li>



<li>LTC rounded out the year after each event up between 80% and 110%.</li>
</ul>



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
<iframe loading="lazy" class="wp-embedded-content" sandbox="allow-scripts" security="restricted" title="Interactive or visual content" src="https://flo.uri.sh/visualisation/13522538/embed#?secret=JsUbR8HDh2" data-secret="JsUbR8HDh2" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div><figcaption class="wp-element-caption">Select the log view to better compare Bitcoin halvings</figcaption></figure>



<h2 class="wp-block-heading">Bitcoin and Litecoin share source code (and halvings)</h2>



Riyad Carey, research analyst at Kaiko, told Blockworks that halvings have been historically bullish catalysts for both BTC and LTC.



“The timing of these halvings is quite interesting: ETH recently moved away from proof-of-work, which helped propel both Bitcoin and Litecoin&#8217;s hash rates to all-time highs as miners looked for alternatives,” Carey said.&nbsp;



There are other concerns: Bitcoin mining profitability tends to shrink after each block reward reduction, as miners are increasingly relying on transaction fees for revenue as they wait for speculative market prices to catch up to profitability.



Carey continued: “Litecoin was for many years a top-five token but has since lost that position to newer, primarily Layer-1, tokens. A pre-halving price rally could generate some excitement and potentially attract miners if they look for alternatives to Bitcoin.”



Halvings are indeed just one factor impacting price, alongside <a href="https://blockworks.co/news/credit-crunch-macro-outlook">macroeconomic environment</a>, <a href="https://blockworks.co/news/crypto-is-more-correlated-with-tech-stocks-than-ever-how-do-we-decouple">correlation with tech stocks</a>, <a href="https://blockworks.co/news/74-of-institutions-plan-to-buy-crypto-fidelity-survey">trends in investor adoption</a> and, increasingly, the <a href="https://blockworks.co/news/celsius-gets-court-blessing-to-sell-its-mined-bitcoin">business savvy</a> of major <a href="https://blockworks.co/news/voyager-crypto-liquidation-almost-complete">crypto companies</a> (or the lack thereof).



It is also worth stressing that the sample size of Bitcoin and Litecoin halvings are incredibly small, which renders realistic conclusions difficult to grasp.&nbsp;



Litecoin launched in 2011, not by hard forking the Bitcoin blockchain (as is the case with Bitcoin Cash and the like), but by creating a direct fork of its source code.



Litecoin developers, led by founder Charlie Lee, made small changes to Bitcoin’s original codebase. Namely faster block times (every 2.5 minutes compared to Bitcoin’s 10 minutes, on average) and a higher supply cap (84 million to Bitcoin’s 21 million).



Litecoin’s value proposition was <a href="https://www.aima.org/static/uploaded/fc0b7771-a1b4-4ecc-b60b3840b98eb726.pdf">once</a> that it could serve, in some sense, as a spiritual sister network, handling smaller transactions faster and cheaper than Bitcoin, while also acting as a store of value.



The advent of the Lightning Network shifted that narrative somewhat. Litecoin eventually <a href="https://www.elliptic.co/blog/explaining-mimblewimble-the-privacy-upgrade-to-litecoin">grew</a> to be a primary testing ground for potential Bitcoin upgrades — privacy focused technology MimbleWimble being one example.



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
<iframe loading="lazy" class="wp-embedded-content" sandbox="allow-scripts" security="restricted" title="Interactive or visual content" src="https://flo.uri.sh/visualisation/13522113/embed#?secret=BXKzNXT9IV" data-secret="BXKzNXT9IV" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div><figcaption class="wp-element-caption">Litecoin’s price is so far tracking its 2015 halving</figcaption></figure>



There are differences, but the general concept is the same: Distribute cryptocurrency to proof-of-work miners as payment for validating transactions and securing the network against 51% attacks.



<h2 class="wp-block-heading">Different crypto, different investors</h2>



Halvings cut those miners’ block rewards in half, leading to a boost to scarcity. As Kaiko’s Carey mentioned, mining profit margins are simultaneously narrowed, especially in Bitcoin’s case; there are less rewards for the same energy-intensive operations.&nbsp;



Unless, of course, prices surge dramatically to make up the difference. 



“There clearly are speculators who dabble in Bitcoin in a big way, just as they dabble in Litecoin and other coins, but I would argue that the fundamentals of BTC are the strongest,” Bob Ras, co-founder at tokenized security startup Sologenic, told Blockworks.



“And because the fundamentals are strong with BTC, this means that it’s only natural the impact from the halving is experienced afterwards instead of before.”



Litecoin tends to rally hard leading up to its halvings because its users are mostly speculators, Ras reasoned, “playing ping pong of sorts” until LTC whales begin dumping after the halving.



Bitcoin sees “mega surges” following its own halvings due to their “dramatic impact on supply and scarcity,” Ras said.



“After all, a lot of Bitcoin is self-custodied and therefore the availability of BTC on exchanges is relatively less on a proportional basis. So when that supply shock kicks in, and if demand stays the same or increases, then the only option is that of fireworks.”



As tempting as it is to see the face of god in market reactions to halvings, correlation does not necessarily imply causation, and these milestones are no different — be they Bitcoin or Litecoin.&nbsp;



Still, a wise investor would strap in for increased volatility. The halvings are coming.



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Halvings Seem to Move Bitcoin and Litecoin in Very Different Ways

Mining activity is surging on a raft of proof-of-work blockchains still riding tailwinds from Ethereum’s switch to proof-of-stake five months ago.



Those beneficiaries of Ethereum’s long awaited Merge, which activated last September and sent the blockchain’s miners out of business, include Dogecoin, Litecoin and Syscoin.&nbsp;



At the time, smaller networks minable with high-end GPUs — a la pre-Merge Ethereum — <a href="https://blockworks.co/news/ether-price-flat-after-merge-as-miners-hunt-for-hashrate-home">immediately saw a major hash rate uptick</a>. Ethereum Classic’s hash rate (a measure of the network’s computing power) ballooned 160% in a single day and RavenCoin’s jumped 80%.



Like Bitcoin, Dogecoin and Litecoin can only really be efficiently mined with specialized ASIC rigs attuned to their hashing algorithm, Scrypt. Those networks, which command far less hash rate than Bitcoin, didn’t book a sudden hash rate boost in September, unlike Ethereum Classic.&nbsp;



But they’ve since set fresh record highs. Dogecoin and Litecoin are “merge-mined,” meaning they can be mined simultaneously without sacrificing performance, leading their hash rates to correlate.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh6.googleusercontent.com/LzJkMPLjY1L2KZnlpl5djArd9clfAVaZ4y1TrDHUF5sHgs76vySZvdx7sdmHhs91yFElV2ndYRGhqys91Kxh97PMJEyTN_OgF38BjZfd7QZi0-DEOaSwKqAoetPCpZXdq6hSMCaQLMW0Z17jbicfr4YCk8AZCGoGmaahIOD4ny2aSFXXKfmCTTZkldqKbA" alt=""/><figcaption class="wp-element-caption">Litecoin’s hash rate chart looks pretty much the same, hitting all-time high in late December</figcaption></figure>



Syscoin’s hash rate is also hovering around highs set in October, although it can’t be mined efficiently with GPUs. The network can, however, be merge-mined with Bitcoin, which itself is maintaining record levels set late last year — even as its price has plummeted.&nbsp;



More hash rate typically equates to more security, as bad actors require more computing power to pull off effective 51% attacks. But are displaced Ethereum miners responsible for Dogecoin and Litecoin’s hash rate pumps?



A spokesperson for Litecoinpool.org, an aptly-named Litecoin mining pool, doesn’t believe so. Common Ethereum mining rigs, such as the RTX 3080, could contribute around 100 MH/s to the network’s hash rate, but less than two MH/s to Litecoin, good for a factor of about 50.



Ethereum’s hash rate was roughly 1,000 TH/s before the Merge. So, if all the miners on Ethereum were to switch to Litecoin, per back-of-the-napkin math, those miners should expect to add about 20 TH/s to Litecoin’s hash rate.



Litecoin’s hash rate has climbed far more than 20 TH/s. It was just over 400 TH/s in September. It’s now sitting around 600 TH/s, a 50% jump.



“I think we can safely say that this jump cannot be attributed to GPUs coming from Ethereum mining, but rather to more Scrypt ASICs entering the market,” the Litecoinpool.org rep said.&nbsp;



They added that Litecoin’s third halving is just a few months away, which means miners may well be looking to get more bang for their buck before issuances are reduced.



<h3 class="wp-block-heading">Litecoin and Dogecoin soar since Merge</h3>



At times, mining Litecoin and Dogecoin to sell for BTC can be more profitable than mining Bitcoin directly. A source familiar with the mining industry told Blockworks that some mid-sized mining operations keep Scrypt ASICs on hand for that exact purpose.



Read more: <a href="https://blockworks.co/bitcoin-mining-economics-explained/">Is Bitcoin Mining Still Profitable? The Economics Explained</a>



The source was granted anonymity because they are not authorized to talk to the media.&nbsp;



Sarah Manter, director of communications for mining platform PROHASHING, told Blockworks that rather than directing old Ethereum GPUs to Scrypt, it was more likely that miners have been buying up used ASICs from those who capitulated when the market crashed — and pointing them at Dogecoin and Litecoin.



Either that, or they’re selling GPUs and buying new ASICs to mine what’s now profitable.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh5.googleusercontent.com/1GXFV1FY-laXjpi9EgOZndwJCMXBpvbgkU2q8FysDaxRJBsnuhZGzH4XG_Xmt8HXMjdfjwYghFj938BWvhTDitJATahkOU1TGPs6YiZjDaJIX8NBn8HyB7_SkiU4j32H0sl365p-aCncYFGS4p3sOQO5TjKbMNMAYBgp5-WZw4NZD5gkEdRg4Qi2sAGWtw" alt=""/><figcaption class="wp-element-caption">Ethereum Classic’s hash rate has retraced since its post-Merge bump</figcaption></figure>



“I have no knowledge of GPUs being repurposed to mine Litecoin, because GPUs haven&#8217;t been able to profitably mine Litecoin/Dogecoin for quite some time,” Manter said.&nbsp;



Added Manter: “I know a lot of GPU miners have either been getting out of the game altogether in favor of other endeavors such as staking, or buying, trading or turning off their workers to wait it out and see what pulls ahead and becomes profitable again.”&nbsp;



Litecoin has increased 24% since the Merge, increasing the odds of profiting from mining the blockchain. Price, though, is just one factor, alongside energy and equipment expenditures, impacting profit.



Dogecoin is up 16% over the same period.



Manter said that no GPU algorithm (and, accordingly, associated blockchains) seems to be pulling ahead of its peers in the same vein as Ethereum’s dominance.&nbsp;



“That doesn&#8217;t mean one won&#8217;t eventually, as the market improves [and] hash rate shifts,” Manter said.



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Litecoin, Dogecoin See Mining Surge After Prices Rise Post-Merge

Jacquelyn Melinek

<div id="highlights-block_611e9f4a199c4" class="highlights">
 <ul>
 <li>Japanese customers in the country can currently buy bitcoin, ethereum and litecoin through Coinbase’s platform, according to its website. </li>
 <li>“We will be launching retail products first including a suite of five top assets based on trading volume, and will add more assets and products in the coming months. We also plan to introduce more localized versions of globally popular services such as advanced trading, Coinbase for Institutions, and more in the future,” the company said.</li>
 </ul>
 
</div>



Coinbase is launching a partnership with Mitsubishi UFJ Financial Group (MUFG) to help bring its platform to Japan, the company said in a post Thursday.&nbsp;



The well-known cryptocurrency platform began in 2012 as a platform for users to buy and sell bitcoin. Since then it has expanded into a crypto-asset platform home to thousands of blockchains, tokens and projects and has become the largest US cryptocurrency exchange. Today, Coinbase serves over 9,000 institutions and 68 million users in over 100 countries.&nbsp;



“At the moment I don’t have anything to share beyond what is in the <a href="https://blog.coinbase.com/coinbase-launches-in-japan-273cd9d6bd8c" target="_blank" rel="noreferrer noopener">blog pos</a>t. But happy to stay in touch should that change,” a Coinbase spokesperson said in an email to Blockworks. 



MUFG is one of the largest banks in Japan with over 40 million Japanese customers. The partnership will help Japanese people access the platform to trade on Coinbase’s exchange by offering “MUFG Quick Deposit” for users in the country, it said.&nbsp;



“We will be launching retail products first including a suite of five top assets based on trading volume, and will add more assets and products in the coming months. We also plan to introduce more localized versions of globally popular services such as advanced trading, Coinbase for Institutions, and more in the future,” the company said.&nbsp;



The company did not disclose an exact date of the launch in Japan. But Japanese customers in the country can currently buy bitcoin, ethereum and litecoin through Coinbase’s platform, according to its website.&nbsp;



While Japan has had strict crypto regulatory guidelines, it was the first country in the world to create a law characterizing “crypto assets” as a legal term. The country requires entities to register as Crypto Asset Exchange Service Providers in order to provide exchange services to residents in Japan. Additionally, under Japanese law crypto assets are not treated as money nor equated with fiat currencies and the assets are not supported by the government or central bank of Japan.&nbsp;



With that said, the adoption of cryptocurrencies in Japan is still accelerating at a quick pace as crypto trading picks up across the nation. For reference, Japan’s virtual currency deposits, also known as cryptocurrency deposits, hit an all time high in March of about 1.4 trillion yen, or about $13 billion. This level was seven times higher than the year-ago month for crypto deposits, according to the Japan Virtual and Crypto Assets Exchange Association (JVCEA).



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