CBOE Seeks SEC Approval for Canary PENGU ETF Backed by Memecoin and NFTs

The CBOE BZX Exchange has submitted a Form 19-b4 to the U.S. Securities and Exchange Commission (SEC) seeking approval to list and trade shares of the Canary PENGU ETF. This ETF is backed by a combination of PENGU memecoin and non-fungible tokens (NFTs), indicating that Canary will eventually file the Form S-1 for its PENGU ETF.

The ETF, filed under BZX Rule 14.11(e)(4) governing Commodity-Based Trust Shares, will be sponsored by Canary Capital Group LLC and structured as a Delaware statutory trust. The trust will not be registered under the Investment Company Act of 1940 and is not classified as a commodity pool.

The ETF will hold PENGU, a utility token issued on the Solana network, and Pudgy Penguin NFTs, a well-known Ethereum-based NFT collection. The trust will also hold small amounts of SOL and ETH to facilitate network transaction fees and NFT purchases. The filing states that the trust is expected to hold approximately 80-95% of its total assets in PENGU and 5-15% of its total assets in Pudgy Penguin NFTs. At least 95% of total assets will be invested in those two assets under normal circumstances.

The CBOE exchange has initiated the approval process for the Canary PENGU ETF by filing a 19b-4 with the SEC. This filing marks the beginning of the regulatory review for the ETF, which, if approved, will allow for the listing and trading of its shares on the exchange. The Canary PENGU ETF is designed to provide investors with exposure to a diversified portfolio of assets, potentially offering a new investment option for those seeking to capitalize on market trends. The filing with the SEC is a crucial step in the ETF's journey to market, as it undergoes scrutiny to ensure compliance with regulatory standards and investor protection measures. The approval process typically involves a thorough review of the ETF's structure, investment strategy, and risk management practices. Once approved, the Canary PENGU ETF will join the ranks of other exchange-traded funds available to investors, providing them with an additional tool for portfolio diversification and risk management. The filing of the 19b-4 is a significant development for the ETF industry, as it signals the continued innovation and expansion of investment products available to market participants. The Canary PENGU ETF, if approved, could offer investors a unique opportunity to gain exposure to a specific market segment or investment theme, potentially enhancing their portfolio performance and risk-adjusted returns. The regulatory review process is expected to take several months, during which the SEC will evaluate the ETF's compliance with relevant laws and regulations. The outcome of this review will determine whether the Canary PENGU ETF can proceed to the next stage of its launch, ultimately leading to its listing and trading on the CBOE exchange. The filing of the 19b-4 with the SEC is a positive development for the ETF industry, as it demonstrates the ongoing efforts to bring new and innovative investment products to market. The Canary PENGU ETF, if approved, could provide investors with a valuable tool for portfolio diversification and risk management, potentially enhancing their investment outcomes. The regulatory review process is a critical step in the ETF's journey to market, as it ensures compliance with relevant laws and regulations, ultimately protecting investors and promoting market integrity.