Canary Capital has filed with the U.S. Securities and Exchange Commission (SEC) for a spot Tron ETF with staking capabilities. As stated in the filing on Friday, the goal is to provide investors access to profit from the appreciation of Tron’s price. Today, Tron is the ninth-largest cryptocurrency with a $23 billion market cap. This action comes on the heels of a wave of ETF applications that track altcoins. The momentum has been fueled by the widely successful launch of funds tied to both Bitcoin and Ethereum.
The potential ETF proposal couldn’t arrive at a better time for Tron’s fate. Its token, TRX, has exploded around 120% this last year! The approval of these 11 Bitcoin funds have attracted billions of dollars in investments. In just 15 months, they have combined for more than $35 billion of net inflows. This success has already pushed the biggest issuers of such funds to see what other cryptocurrencies they can take a stab at.
ETF Application Details
Canary Capital, a crypto-focused asset manager based in Nashville, Tennessee, is venturing into the ETF market with this innovative product. The company’s been waiting for the SEC to approve its applications for Sui, Pudgy Penguins and XRP funds too. The fund attempts to replicate Tron’s daily price changes. This allows investors the regulated and convenient means to gain exposure to the cryptocurrency.
One of the key stand-out features of the proposed Tron ETF would be its inclusion of staking capabilities. What is staking Staking is the process of holding cryptocurrency to support the network and earn rewards. That said, the SEC has so far not allowed a staking feature to be implemented in any crypto ETF.
Regulatory Landscape and Altcoin ETF Race
The SEC’s position on the acceptability of staking in crypto ETFs is still unclear. The federal regulatory agency has delayed making a final decision on a rule it proposed to change. This amendment would allow Grayscale’s spot ETH funds to engage in staking activities on Ethereum. This lengthy delay underscores the myriad complexities and regulatory challenges that would go into importing staking into investment products.
BlackRock, Bitwise, 21Shares, and VanEck are the largest fund providers. They are furiously lobbying for SEC approval of their proposed ETFs that would track all sorts of altcoins. Industry analysts consider Ripple’s XRP and Solana ETFs the likeliest suspects for near-term approval. Their robust market positioning and positive regulatory environment create an encouraging long-term outlook, making them great candidates. Tron was recently trading at around $0.24, off more than 3% in the last 24 hours.
Market Impact and Future Prospects
The altcoin ETF push is evidence of a robust demand to expand cryptocurrency investment beyond Bitcoin. The highly successful launch of Bitcoin and Ethereum ETFs holds tremendous potential. These investment vehicles regulated under the Internal Revenue Code are increasingly appealing to both institutional and retail investors. Canary Capital has made an aggressive application for one Tron ETF with staking abilities. This action widens the field of crypto investment products that can be offered to the general public.
Still, the SEC’s extremely constrained approval process is the last line of defense for deciding the future of these proposed ETFs. These decisions by the regulatory body could have a huge effect on the future landscape of cryptocurrency investment. In addition, they’ll advise fund issuers on developing strategies to capture the growing appetite for digital assets.
