Canary Capital Files Staked TRX ETF With SEC

Canary Capital Group LLC has made a significant move in the crypto investment landscape by filing for a staked Tron (TRX) ETF with the U.S. Securities and Exchange Commission (SEC). This filing, submitted on Friday, marks a strategic play that could attract institutional interest in one of the most actively used crypto networks. Unlike traditional ETFs, the proposed Canary Staked TRX ETF aims to not only track TRX price action but also stake a portion of the holdings to generate network rewards, offering a yield-bearing dynamic that is rare in traditional ETFs.

The preliminary prospectus outlines that the ETF will provide investors with direct exposure to TRX’s market price, adjusted for the trust’s operating expenses. The trust plans to stake TRX tokens, potentially generating passive income through network rewards. However, this approach comes with risks such as liquidity constraints and penalties. The net asset value (NAV) will be calculated daily at 4 p.m. ET, using Coindesk Indices as a benchmark to ensure transparency and consistency in price reference.

The fee structure of the ETF is designed to cover ordinary operating costs by the sponsor, Canary Capital, while extraordinary expenses will be borne by the trust itself. Shares will be created or redeemed in cash under SEC Rule 415 and issued in baskets tied to the TRX value per share. The trust is structured as a Delaware statutory trust and is governed by an agreement between Canary and the trustee, CSC Delaware Trust Company. Bitgo Trust Company, a major player in crypto custody, will safeguard the TRX assets.

Investors in the ETF will not receive voting rights, and the trust will not use the assets as collateral or engage in lending, emphasizing its purely exposure-based structure. This filing is part of a broader strategy by Canary Capital, which has also filed for ETFs tied to various other digital assets, including SUI, LTC, PENGU, HBAR, XRP, AXL, DOGE, and SOL. This diversification suggests that Canary is positioning itself as a key issuer for a range of digital asset ETFs.

Canary Capital, founded by Steven McClurg, the former co-founder and CIO of Valkyrie Funds, has deep roots in institutional finance and digital asset strategy. By targeting TRX with a staking component, Canary is innovating by combining the yield potential of on-chain DeFi with the accessibility of a publicly traded financial product. This move comes at a time when the SEC is gradually warming up to spot crypto ETFs, following recent approvals. This filing could signal a shift in the future of crypto investment, potentially opening the door for more yield-generating ETFs that bridge the gap between institutional investment and blockchain utility.

If approved, the staked TRX ETF could mark a turning point in the crypto investment landscape, paving the way for more innovative and yield-generating ETFs. This filing is more than just another ETF application; it is a signal that the next wave of crypto ETFs might look very different from the last, potentially redefining how digital asset exposure is offered to mainstream investors.