- Canary Capital has filed with the SEC for approval of a Tron (TRX) ETF with staking capabilities.
- This is one of several crypto ETF applications from Canary, which has also filed for XRP, Solana, Sui, and Pudgy Penguins funds.
- The staking feature remains controversial, as the SEC has not yet approved any crypto ETF with staking functionality.
Canary Capital submitted an S-1 prospectus to the U.S. Securities and Exchange Commission on Friday for a spot Tron (TRX) ETF that would include staking capabilities. The proposed "Canary Staked TRX ETF" would give investors exposure to Tron’s price movements while potentially earning additional yield through staking rewards.
The Nashville, Tennessee-based asset manager stated in its filing that the fund’s "investment objective is to seek to provide exposure to the price of Tron." The prospectus does not yet specify which exchange would list the proposed fund.
Growing Trend of Crypto ETF Applications
This filing joins a wave of applications for cryptocurrency exchange-traded funds following the successful launch of Bitcoin ETFs, which have accumulated over $35 billion in net inflows across 11 funds during a 15-month period. Canary Capital has been particularly active, filing for multiple crypto ETFs including those based on Sui, Pudgy Penguins, XRP, and Solana.
The Tron-based ETF would add to the expanding universe of crypto investment products seeking regulatory approval. Industry analysts believe that XRP and Solana ETFs are the most likely candidates to receive SEC approval next, following the path cleared by Bitcoin and Ethereum funds.
Staking Feature Faces Regulatory Hurdles
The staking component of Canary’s TRX ETF proposal represents a controversial aspect of crypto fund regulation. Staking involves pledging proof-of-stake assets to help secure a network in exchange for rewards. Supporters argue it enhances institutional adoption of crypto products, while critics consider it an unnecessary investment risk.
The SEC has yet to approve any crypto ETF with staking capabilities. Just this Monday, the regulator delayed a decision on a proposed rule change that would allow Grayscale’s Ethereum ETFs to engage in staking activities.
Tron, currently the ninth-largest cryptocurrency with a $23 billion market capitalization, trades at approximately $0.24, showing a 120% increase over the past year despite a recent 3% decline. The TRX token operates on its own blockchain, with the stated goal of building a decentralized internet controlled by its users.
Major fund issuers including BlackRock, Bitwise, 21Shares, and VanEck are also seeking SEC approval for various crypto ETFs, indicating continued institutional interest in expanding regulated crypto investment options.
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