With its groundbreaking approach to investment strategy, Canary Capital is quickly disrupting the traditional crypto investment landscape. This week the U.S. based, Tron (TRX) first and only exchange-traded fund (ETF) including staking. The new Canary Staked TRX ETF would offer investors a unique opportunity to gain exposure to the spot price of TRX. In addition, it produces yield by accruing staking rewards. This innovative approach could set a precedent for future staking-based ETFs if approved by the Securities and Exchange Commission (SEC).
Canary Capital's Bold Move into Tron Exposure
Canary Capital takes aim at Tron to expand its crypto ETF aspirations with a risky new filing. If approved, the firm’s proposal would be the first exchange-traded fund in the U.S. dedicated exclusively to TRX. What makes it different is that it’s providing staking from day 1. The ETF’s approach would allow it to hold actual TRX tokens and stake a portion of its holdings through third-party platforms trusted by its managers.
The proposed ETF, called the Canary Staked TRX ETF, would solely hold and stake TRX while providing exposure to spot price. The fund’s price will mirror TRX’s spot value, as determined by CoinDesk Indices, less fees. BitGo is rumored to be the ETF’s custodian.
Canary Capital will be staking about half of the fund’s TRX holdings. This strategy was designed to give our members regulated exposure to the industry’s most important infrastructure layer, a proven inflation hedge, and yields through regulated on chain participation. The firm’s choice to make staking a central feature sets its proposal apart from other crypto ETFs.
Strategic Push into Altcoin ETFs
Canary Capital’s TRX proposal is the natural next step in a wider strategic play into altcoin-focused, altcoin-centric ETFs. The firm has kept its hands full creating additional crypto funds. These funds seek to invest in various digital assets including Solana (SOL), XRP, Hedera (HBAR), Litecoin (LTC), Sui (SUI), and Axelar (AXL). This step marks the start of a larger trend of demand for exposing investors to a wider range of investment assets apart from Bitcoin and Ethereum.
The firm’s aggressive altcoin play is indicative of overall confidence in the altcoin space to create massive returns. Canary Capital provides ETFs with a more narrow focus for specific altcoins. This method is ideal for retail and institutional investors who are looking for direct, precise crypto market exposure.
The average annual return on TRX staking is about 4.5% according to StakingRewards.com. While the fund plans to use third-party staking providers, the exact platforms are still to be announced.
Potential Impact and Future Implications
The SEC approval of the Canary Staked TRX ETF would break new ground for the SEC, crypto, and financial markets. This regulatory development paves the way for the launch of additional staking-based ETFs. Investors are going to see some really cool new ways to start earning passive income on their digital asset holdings.
The success of Canary Staked TRX ETF would depend on a myriad of deciding factors. These factors include Tron's performance, how well the staking strategy works, and broader market conditions. This last filing represents a significant step forward in the evolution of crypto ETFs. Its ability to replace the SFR status quo and tap into the ESG wave is enormous.
