Grayscale Litecoin Trust (LTCN): Bye Bye, Litecoin Premium (Rating Downgrade)

Back in August I covered the Grayscale Litecoin Trust (OTCQX:LTCN) for Seeking Alpha. At that time, I called shares in the fund a 'hold' and even suggested longing Litecoin (LTC-USD) directly rather than LTCN

Grayscale Litecoin Trust (OTCQX:LTCN) shares are surging sharply on Friday after a key analyst at Seeking Alpha upgraded the fund to a ‘buy’ from a ‘hold’ previously.

Here is what you need to know about the latest Grayscale Litecoin Trust price action and analysis.

Grayscale Litecoin Trust (OTCQX:LTCN) shares soared on Friday after an analyst at Seeking Alpha called the Grayscale Litecoin Trust (OTCQX:LTCN) a ‘buy’ following a recent performance review.

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The trust, which tracks the performance of Litecoin (LTC-USD) by holding the cryptocurrency in a trust, saw its shares rise by over 10% in premarket trading.

The analyst, Phira Phonruewiangphing, had previously recommended holding the Grayscale Litecoin Trust (OTCQX:LTCN) shares in August and even suggested that investors might be better off longing Litecoin (LTC-USD) directly.

However, Phonruewiangphing’s latest analysis prompted a rating upgrade for the Grayscale Litecoin Trust (OTCQX:LTCN) shares, citing a recent surge in Litecoin’s price.

The analyst highlighted the trust’s premium, which has narrowed significantly since August, as a key factor in the upgrade.

At the time of writing, Grayscale Litecoin Trust (OTCQX:LTCN) shares are trading at $22.01, up 11.16% for the day and about 53% up year-to-date.

Grayscale Litecoin Trust (OTCQX:LTCN) vs Litecoin (LTC-USD)

Investors can gain exposure to Litecoin either directly by buying the cryptocurrency or indirectly through the Grayscale Litecoin Trust (OTCQX:LTCN) shares.

While both routes offer a way to capitalize on Litecoin’s price performance, there are key differences to consider.

Buying Litecoin (LTC-USD) directly through a cryptocurrency exchange like Coinbase (NASDAQ:COIN) or Binance provides investors with complete ownership and control over their crypto holdings.

However, this also means handling the safekeeping of your private keys and navigating the complexities of cryptocurrency exchanges.

On the other hand, investing in the Grayscale Litecoin Trust (OTCQX:LTCN) shares offers a more traditional approach, where investors can buy and sell the trust's shares through a brokerage account, like any other stock.

This simplifies the investment process but comes with additional costs, such as expense ratios and bid-ask spreads, which are not applicable when buying Litecoin directly.

Ultimately, the best choice for you will depend on your specific investment goals, risk tolerance, and whether you prefer direct or indirect exposure to Litecoin.