Long Solana, Short Litecoin could be attractive if the ETF is approved: K33

Solana (SOL) is assessed to be less affected by the supply pressure from Grayscale compared to Litecoin (LTC) in the event that the Securities and Exchange Commission (SEC) approves altcoin ETF funds.

In a recent report, Vetle Lunde – Head of Research at K33 Research – noted that the emergence of Solana and Litecoin ETFs could create mixed investor sentiment. He also suggested that the trading strategy "long SOL, short LTC" could become attractive if these ETFs are listed.

Differences between Solana and Litecoin Trust Funds

According to K33, the Grayscale Solana Trust, launched in 2023, only accounts for 0.1% of the total circulating supply of SOL and has never traded below its net asset value (NAV). This helps eliminate the risk of excess supply potentially flooding the market if this fund is converted into an ETF.

In contrast, the Grayscale Litecoin Trust – launched earlier – traded at a deep discount multiple times during the bear market of 2022 and continued for most of 2025. This fund currently holds 2.65% of the circulating supply of LTC, making the risk of a strong capital outflow when converting to an ETF evident.

Lunde said:

"We assess the long SOL, short LTC strategy as attractive after the ETFs are launched, assuming both occur at the same time. However, since LTC often reacts strongly to positive news, we may wait a few more days after the ETF launch before starting to act."

SOL & LTC Grayscale Trust | Source: K33## Impact from previous Grayscale funds

The report from K33 also reiterates that last year, Bitcoin and Ethereum ETFs faced significant pressure from capital withdrawals from Grayscale funds. However, this pressure was somewhat offset by inflows into other ETF products.

For Litecoin, the situation may be more complicated. Besides Grayscale, only two other entities, Canary Capital and CoinShares, have applied for the LTC ETF. The lack of alternative issuers limits the ability to absorb outflows.

Upcoming prospects

The SEC recently approved a common listing standard for cryptocurrency ETFs, paving the way for decisions on Solana and Litecoin ETFs in early October, before the agency reviews other filings at the end of the month.

Currently, SOL is trading around 210 USD ( down 2% in the past 24 hours), while LTC is at 107 USD ( up 0.1%).

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