- Nasdaq seeks SEC approval for Canary HBAR ETF, tracking spot prices
- ETF holds HBAR and cash, with assets secured by Coinbase and BitGo
- Canary Capital also plans spot Litecoin and XRP ETFs for investors
Nasdaq has filed a proposed rule change with the U.S. Securities and Exchange Commission (SEC) to list and trade shares of the Canary HBAR ETF. This ETF aims to provide institutional investors with exposure to the Hedera Network’s HBAR token.
Nasdaq Files For Canary HBAR ETF
The Canary HBAR ETF will track the spot price of HBAR, using the CoinDesk Hedera USD CCIX 30-minute NY Rate as its pricing benchmark. This benchmark aggregates spot market prices from major digital asset platforms to determine the net asset value (NAV) of the ETF shares and enhance transparency in asset valuation.
The ETF will be managed by Canary Capital and will hold HBAR and cash, with its shares traded in blocks of 10,000 units, called “Baskets.” The filing follows the launch of Canary Capital’s HBAR Trust in October 2024 which reflects the firm’s commitment to expand its digital asset offerings.
Canary Capital has partnered with Coinbase Custody Trust Company and BitGo Trust Company to secure the ETF’s assets. Although shares are not individually redeemable, they can be exchanged in large blocks to provide liquidity and flexibility in trading. This structure complies with Nasdaq’s listing standards for commodity-based trust shares, ensuring that the ETF meets regulatory requirements for transparency and market integrity.
Canary Capital ETF Portfolio
Moreover, Canary Capital seeks to expand its product portfolio with a spot Litecoin ETF, which awaits SEC approval. Litecoin’s favorable regulatory outlook, including its classification as a commodity by the Commodity Futures Trading Commission (CFTC), enhances its potential for institutional investment. Canary’s Litecoin ETF has already appeared on the Depository Trust and Clearing Corporation (DTCC) under the ticker LTCC, which places it closer to its potential launch.
Furthermore, Canary Capital is seeking SEC approval for a spot XRP ETF to expand its reach into additional high-demand cryptocurrencies.
The firm has also launched the Canary AXL Trust, which offers institutional investors secure exposure to AXL, the token driving Axelar Network’s blockchain interoperability technology. This initiative marks the first of its kind in providing blockchain interoperability-focused investment solutions.
Nasdaq’s Role in the Crypto-Based ETF Market
Nasdaq’s filing highlights the growing trend of cryptocurrency-based exchange-traded products (ETPs) aimed at institutional investors. The exchange is committed to maintain strict surveillance procedures to prevent market manipulation and fraud. Nasdaq’s oversight includes real-time monitoring of price movements and trading patterns to ensure compliance with federal securities laws.
If approved, the Canary HBAR ETF will provide investors with a regulated and secure way to gain exposure to HBAR. It will also contribute to the growing space of cryptocurrency-based ETPs, making digital assets more accessible to various institutional investors.
Nasdaq’s role in ensuring compliance with regulatory standards will be essential in the continued growth and development of this emerging market.