Canary Capital Files for Spot Tron ETF with Staking Feature
Canary Capital has submitted a fresh application to the U.S. Securities and Exchange Commission (SEC) for a spot Tron exchange-traded fund (ETF) that would include a staking component.
Filed on Friday, the S-1 prospectus outlines the proposed Canary Staked TRX ETF, which aims to offer investors direct exposure to Tron (TRX), the ninth-largest cryptocurrency by market capitalization.
According to the filing, the fund’s investment goal is to track the price performance of Tron while enabling investors to earn additional rewards through staking.
Staking Feature in ETFs Faces Regulatory Scrutiny Amid SEC Hesitation
Staking allows holders of proof-of-stake (PoS) cryptocurrencies to contribute to network security and operations in exchange for periodic rewards.
However, incorporating staking into an ETF has become a point of regulatory contention.
The SEC has yet to approve any ETF that includes staking, citing potential investor risks and operational complexities.
Earlier this week, the agency delayed a decision on whether Grayscale’s proposed spot Ethereum fund can include staking.
Canary Capital, based in Nashville, Tennessee, is among a growing number of firms racing to bring altcoin-focused ETFs to market.
The firm has also filed for ETFs tied to XRP, Sui, and Pudgy Penguins—part of a wider trend spurred by the strong performance of recently approved Bitcoin and Ethereum ETFs.
Since launching in early 2023, the 11 spot Bitcoin funds have attracted over $35 billion in net inflows.
The new filing did not specify which exchange the proposed Tron ETF would list on, leaving that detail for future updates.
TRX, the native token of the Tron blockchain, was trading at around $0.24 at the time of the filing, down 3% over the past 24 hours. However, the token has posted a strong 120% gain over the past year.
Other major players such as BlackRock, Bitwise, VanEck, and 21Shares are also seeking SEC approval for altcoin ETFs, with industry experts pointing to XRP and Solana as the frontrunners for the next potential approvals.
SEC Postpones Rulings on Staking and In-Kind Crypto ETF Rules
Last week, the SEC delayed its decisions on proposed rule changes related to staking features and in-kind creations and redemptions for several cryptocurrency ETFs.
The delay allows the regulator more time to evaluate the implications as its dedicated crypto task force continues work on shaping long-term digital asset policies. Final decisions are now expected later this year.
The SEC’s crypto task force, created to develop clearer regulations for the industry, has already held meetings with several key stakeholders.
In February, executives from Jito and Multicoin Capital met with the agency to push for staking-enabled ETFs that would allow investors to earn yield by locking up crypto assets.
The task force has also reversed many previous enforcement actions targeting crypto firms.
Among the delayed cases are the Grayscale Ethereum Trust and Ethereum Mini Trust, which sought to stake held ETH, and VanEck’s Bitcoin and Ethereum Trusts, which proposed allowing in-kind transactions using crypto instead of cash.
The SEC has extended its deadlines for both proposals to June 1 and June 3, respectively.
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