Litecoin Hits Stock Market: Grayscale Trust Goes Public
Published Date: 2/12/2025
Notice
Summary
NYSE Arca wants to start trading shares of the Grayscale Litecoin Trust, letting investors buy and sell Litecoin-based shares easily on their platform. This change affects anyone interested in cryptocurrency investments and could open new ways to invest starting soon after approval. It’s a big step for crypto fans looking for simpler, regulated ways to trade Litecoin.
Analyzed Economic Effects
5 provisions identified: 3 benefits, 1 costs, 1 mixed.
Shares of Grayscale Litecoin Listed
On January 24, 2025 (Amendment No. 1 filed February 3, 2025), NYSE Arca proposed listing and trading shares of the Grayscale Litecoin Trust under NYSE Arca Rule 8.201-E. If approved, investors will be able to buy and sell the Trust's shares (expected ticker: LTCN) on a regulated national securities exchange.
Sponsor Fee and Share Dilution
The Trust currently accrues a Sponsor's Fee payable in LTC at an annual rate of 2.5% (calculated daily). The filing states that this fee "will be lowered in connection with the Trust becoming an ETP," and notes that the number of LTC represented by each Share will gradually decrease over time as LTC are used to pay Trust expenses.
OTC Share Status After Listing
Shares of the Trust that have been freely tradeable on the OTCQX Marketplace under the symbol "LTCN" (quoted there since August 18, 2020) will remain freely tradeable Shares on the date of any listing. Restricted shares will remain subject to their private placement restrictions until they become freely tradable.
Index Price Controls NAV Calculation
The Trust uses the CoinDesk Litecoin Price Index (LTX) as the Index Price to calculate NAV (determined daily at 4:00 p.m. New York time). The Index Provider may change the Index Price calculation methodology at its sole discretion, and the Index Price is used to value the Trust's LTC and compute NAV.
Custody and Security Measures
The Trust's custodian is Coinbase Custody Trust Company, LLC, which the filing says generates keys in offline ceremonies, encrypts and shards private keys, stores shards in geographically distributed secure vaults (including in the U.S.), and uses cold (offline) storage for the Trust's private keys.
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