Canary Capital files for first-of-its-kind Hedera HBAR spot ETF with SEC

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The Block2024/11/11 16:00

By:The Block

Quick Take The crypto investment firm filed an S-1 registration statement with the SEC on Tuesday. The fund will “provide exposure to the value of the native asset of the Hedera Network,” according to the filing.

Canary Capital files for first-of-its-kind Hedera HBAR spot ETF with SEC image 0

Canary Capital has filed for a Hedera HBAR spot exchange-traded fund with the U.S. Securities and Exchange Commission — marking a first for that type of crypto fund.

The crypto investment firm filed an S-1 registration statement with the SEC on Tuesday. The fund looks to "provide exposure to the value of the native asset of the Hedera Network," according to the filing .

HBAR is the native digital asset of the Hedera network, which is a decentralized public network using the Hashgraph consensus algorithm. Hedera facilitates fast and secure transactions globally and is governed by a council made up of prominent companies and organizations. This governance model is designed to ensure decision-making and token distribution are conducted in a secure and compliant manner. HBAR is used within the Hedera ecosystem for various purposes, including powering decentralized applications, facilitating transactions and participating in network governance.

According to the filing, the Canary HBAR ETF intends to hold only HBAR directly without using derivatives, futures, or other financial instruments. A custodian and administrator are not named in the S-1 filing.

The firm also previously launched a HBAR Trust in October for accredited investors. Steven McClurg founded Canary Capital and previously founded Valkyrie Funds, which has other spot crypto ETFs. Canary Capital has previously filed registration statements for a spot Litecoin ETF, a Solana ETF and an XRP ETF.

It is unclear whether the SEC would approve more spot crypto ETFs. The agency approved 11 spot bitcoin ETFs earlier this year and soon after gave the green light for eight Ethereum ETFs. These filings also come amid an increased likelihood that current SEC Chair Gary Gensler, who has been critical of crypto, could decide to step down before a new presidential administration rolls in. President-elect Donald Trump has also said he would fire Gensler if elected.

ETF Store President Nate Geraci said Canary Capital’s filing on Tuesday could be indicative of how firms see crypto regulations changing under a new administration.

“This is a very early indication of how significantly some ETF issuers expect the crypto regulatory winds to shift,” Geraci said in a message to The Block. “My expectation is that issuers will grow increasingly aggressive with crypto-related ETF filings in an attempt to test out the SEC under the new Trump administration.”

Officials representing Trump are reportedly considering Robinhood Chief Legal Officer Dan Gallagher, former Republican SEC commissioner Paul Atkins and former SEC general counsel Robert Stebbins to chair the SEC, according to a report from Reuters .

When approving spot bitcoin ETFs in January, Gensler said the agency's decision was " cabined to one set of filings."

"We have other filings… in front of us, but I'm not going to prejudge it for you or the audience," Gensler said in an interview with CNBC. "That's something that a five member commission discusses and reviews."

Update: Nov. 12, 6:00 p.m. UTC to include details throughout

Update: Nov. 12, 6:55 p.m. UTC to include comments from Nate Geraci

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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