Canary Capital Has Filed an S-1 Registration with the US Securities and Exchange Commission (SEC) to Launch a Spot Exchange-Traded Fund (ETF) Focused on Tron (TRX)

The proposal, submitted on April 18, is the first of its kind to offer investors exposure to TRX's market performance while also providing staking rewards.

Canary Capital has submitted a Form S-1 registration with the US Securities and Exchange Commission (SEC) to launch a spot exchange-traded fund (ETF) focused on Tron (TRX).

This proposal, submitted on April 18, aims to offer investors exposure to TRX’s market performance while also providing staking rewards, setting it apart from previous spot crypto ETF proposals.

The filing designates BitGo Trust Company as the custodian for TRX holdings and appoints Canary Capital as the fund’s sponsor.

Justin Sun, the founder of Tron, took to X to encourage US investors to start investing in TRX, highlighting its potential for long-term growth. He also noted that institutional interest in TRX would surge if the ETF is approved.

“US VCs should start buying TRX — and fast. Don’t wait until it’s too late. TRX is a price that only moves one way: up,” Sun said.

According to BeInCrypto data, TRX is currently the ninth-largest crypto by market capitalization, with a total value of approximately $22.94 billion.

Furthermore, Tron’s blockchain has seen significant use in stablecoin settlements, becoming the second-largest network after Ethereum for Tether’s USDT, based on data from DeFiLlama.

This proposal, if approved, could see the first TRX ETF hit the market, offering investors a unique opportunity to invest in one of the largest cryptocurrencies.

However, the chances of this ETF gaining regulatory approval remain uncertain, especially considering the inclusion of staking within the fund. The SEC has previously expressed opposition to such features in other crypto funds.

The commission has flagged staking services within investment products as potential unregistered securities, leading to increased scrutiny.

Due to this, past Ethereum ETF proposals were forced to remove staking components to align with regulatory expectations.

Nonetheless, several firms, including Grayscale, are continuing to push for altcoin ETFs that incorporate staking or offer broader asset exposure.

This development comes as several companies are applying for Bitcoin and Ethereum ETFs in the US. The first Bitcoin ETF, ProShares Bitcoin Strategy ETF, was approved in 2021, paving the way for a wave of crypto ETFs to enter the market.

Despite this progress, there are still significant hurdles for altcoin ETFs, especially those with unique features like staking.

The approval of Canary Capital’s TRX ETF would be a historic milestone, offering a combination of TRX exposure and staking rewards, attracting both retail and institutional investors.