What is the Canary Litecoin ETF?
The Canary Litecoin ETF is an exchange-traded product designed to provide investors with exposure to the price of Litecoin (LTC) through a traditional brokerage account.
The Trust holds LTC directly. Its investment objective is to seek to provide exposure to the price of the LTC held by the Trust, less the expenses of the Trust’s operations and other liabilities.¹
What is LTC?
LTC is the native digital asset of the Litecoin Network, a peer-to-peer, decentralized network of computers operating on cryptographic protocols. No single entity owns or operates the Litecoin Network.
Litecoin was created in 2011 as a proof-of-work alternative to Bitcoin. It differs from Bitcoin in several ways, including a block generation time of approximately two and a half minutes and a supply cap of 84 million LTC.¹
Does the ETF stake its LTC?
No. Litecoin is a proof-of-work network and does not support staking. The Trust will not directly or indirectly participate in any staking program, and shareholders will not receive staking rewards.¹
How does the ETF obtain exposure to LTC?
The Trust holds actual LTC rather than using futures contracts or derivatives.
The value of the Shares is expected to reflect the value of the Trust’s LTC holdings, less fees and expenses.¹
How is the Trust’s NAV determined?
The Trust establishes its net asset value (NAV) on each business day by reference to the CoinDesk Litecoin CCIXber 60m New York Rate, calculated by CoinDesk Indices based on a 60-minute time-weighted average price aggregated from executed trade flow across major LTC trading platforms.¹
Does buying the ETF mean I own LTC?
No. Investors own shares of the ETF. The Trust owns the underlying LTC on behalf of shareholders.
How is the Trust’s LTC stored?
According to the registration statement, the Trust’s LTC is held by qualified digital asset custodians using institutional custody solutions. Coinbase Custody Trust Company, LLC and BitGo Trust Company, Inc. serve as the Trust’s custodians and hold all of the Trust’s LTC on the Trust’s behalf.¹
Can I transfer my ETF shares to a crypto wallet?
No. ETF shares trade through brokerage accounts and cannot be transferred to blockchain wallets.
Can I redeem ETF shares for LTC?
No. Retail investors generally buy and sell ETF shares on an exchange.
Shares are not redeemable directly for LTC by individual investors.
How does the ETF’s price relate to the price of LTC?
The Trust is designed to track the value of its LTC holdings, less fees and expenses.
Like other exchange-traded products, market prices may vary slightly from NAV during the trading day.
What are the primary risks?
As described in the registration statement, risks include:
- Changes in the market price of LTC
- Digital asset market volatility
- Blockchain and network risks
- Custody risks
- Regulatory developments
- Operational risks
Investors should review the prospectus carefully before investing. For a more comprehensive list of the Fund’s risks, please view the prospectus. Read the prospectus carefully before investing.¹
¹https://www.sec.gov/Archives/edgar/data/2039461/000183988225002329/canary-s1a_011525.htm
Investing Involves Significant Risk. The loss of principal is possible. Canary Litecoin ETF (the “Fund”) may not be suitable for all investors. This website does not constitute a recommendation of any investment strategy or product for a particular investor. Investors should consult a financial advisor/financial consultant before making any investment decisions.
The Fund’s investment objectives, risks, charges and expenses should be considered before investing. The prospectus contains this and other important information, and it may be obtained at https://canaryetfs.com/LTCC/prospectus/. Read it carefully before investing.
The Fund is not a registered commodity pool or an investment company registered under the Investment Company Act of 1940. Shares of the Fund are not subject to the same regulatory requirements as mutual funds. These investments are not suitable for all investors. Funds focusing on a single asset generally experience greater volatility. Please ask your financial advisor for more information about these risks. Digital assets, such as Litecoin, are a relatively new asset class, and the market for digital assets is subject to rapid changes and uncertainty. Digital assets are largely unregulated and digital asset investments may be more susceptible to fraud and manipulation than more regulated investments.
Litecoin is subject to unique and substantial risks, including significant price volatility and lack of liquidity, and theft. The value of an investment in the Fund could decline significantly and without warning, including to zero. Litecoin is subject to rapid price swings, including as a result of actions and statements by influencers and the media, changes in the supply of and demand for digital assets, and other factors. There is no assurance that Litecoin will maintain its value over the long-term.
Fund Risks
Failure by the Fund’s Custodians to exercise due care in the safekeeping of the Fund’s Litecoin could result in a loss to the Fund. Investors cannot be assured that the Custodians will maintain adequate insurance with respect to the Litecoin held by the Custodians on behalf of the Fund to cover such losses.
The Fund is new with a limited operating history. The Fund is not actively managed and will not take any actions to take advantage, or mitigate the impacts, of volatility in the price of Litecoin. An investment in the Fund is not a direct investment in Litecoin. Investors will not have any rights that Litecoin holders have and will not have the right to receive any redemption proceeds in Litecoin. Shares of the Fund are generally bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Only Authorized Participants may trade directly with the Fund and only large blocks of Shares called “creation units.” Your brokerage commissions will reduce returns.
The amount of Litecoin represented by shares of the Fund will decrease over the life of the Fund due to sales of Litecoin necessary to pay the sponsor’s fee and fund expenses. Without increases in the price of Litecoin sufficient to compensate for that decrease, the price of the shares will also decline, and investors will lose money on their investment. The liquidation of the Fund may occur at a time when the disposition of the Fund’s Litecoin will result in losses to investors.
The Fund’s Marketing Agent is Paralel Distributors LLC which is not affiliated with Canary Capital Group LLC or its affiliates, U.S. Bank Global Fund Services, U.S. Bank National Association, BitGo Trust Company LLC and Coinbase Custody Trust Company LLC.
