Canary Capital has taken a significant step by initiating the process to register a Hedera [HBAR] exchange-traded fund [ETF]. On November 12th, the investment company filed an S-1 form with the U.S. Securities and Exchange Commission (SEC), indicating its desire to offer direct exposure to HBAR through an ETF.
This submission eliminates the possibility of using HBAR-related derivatives or futures contracts, which keeps the asset away from the oversight of the U.S. Commodity Futures Trading Commission (CFTC). Currently, no information has been revealed regarding the exchange, custodian, or ticker symbol for the proposed ETF.
Canary’s HBAR ETF Launch
Interestingly, this action comes right after Canary’s introduction of the HBAR Trust in October—the initial dedicated HBAR investment method in the U.S. This private offering allows eligible investors to securely invest in HBAR.
It is worth mentioning that this marks the fourth ETF application by Canary. Previous submissions focused on other well-known digital currencies like Ripple [XRP], Solana [SOL], and Litecoin [LTC].
Debate Arises Around HBAR ETF in Crypto Community
Despite being unexpected, the filing has triggered diverse reactions from industry professionals. Many view it as a timely reaction to changing regulatory expectations following Donald Trump’s recent electoral win.
In a recent post on X, Eric Balchunas, a senior ETF analyst at Bloomberg, likened the situation to
“The post-Trump spaghetti cannon in effect..”
The analyst hinted at a possible influx of ETF proposals soon, stating,
”Doge ETF incoming in 3.. 2.. 1..”
Contributing to the conversation, Nate Geraci, President of ETF Store, mentioned to The Block that this filing serves as an early indication of how some ETF issuers are anticipating significant shifts in crypto regulatory policies. Geraci commented,
“My expectation is that issuers will become increasingly bold with their crypto-related ETF applications to test the SEC under the new Trump administration.”
Market Reaction
Following the submission, HBAR experienced a positive upswing. Currently, it is trading at $0.058, reflecting a 3.57% increase in the last 24 hours.
Moreover, over the past week, it surged by double-digit percentages, showcasing a gain of more than 19%. This surge pushed the market capitalization to $2.20 billion, indicating a 3.04% rise.
Trading volume spiked significantly, with a 280% increase over 24 hours, totaling $689.34 million. According to CoinMarketCap, HBAR secured the 45th spot in the list of largest cryptocurrencies.
Prospects for HBAR ETF Approval
Notably, the approval of an HBAR spot ETF remains uncertain. While recent approvals for Bitcoin [BTC] and Ethereum [ETH] ETFs show progress, forthcoming approvals for other crypto assets are not guaranteed.
Nonetheless, Trump’s victory has brought about a new era for the industry. With the potential change in leadership involving Gary Gensler’s likely removal as SEC Chair, many experts are optimistic about the future of crypto ETFs.
Hence, Canary Capital’s application for an HBAR ETF signifies the growing demand for a variety of crypto-backed ETFs. If approved, it could establish a precedent, fostering wider acceptance of alternative crypto assets in the U.S. financial sector.