Canary Capital Files for a Staked TRX ETF, Aiming to Bring Institutional Exposure and Rewards

Canary Capital has filed with the U.S. Securities and Exchange Commission (SEC) for a staked TRX ETF, aiming to bring institutional exposure and staking rewards

Canary Capital has filed with the U.S. Securities and Exchange Commission (SEC) for a staked TRX ETF, aiming to bring institutional exposure and staking rewards for Tron (TRX) investors. This follows the approval of several Bitcoin (BTC) ETFs and the growing trend of institutions seeking yield-generating digital assets.

The proposed Canary Staked TRX ETF will hold and stake Tron's native token, TRX, providing a unique product offering compared to traditional spot-based ETFs. The ETF is designed to provide investors with regulated access to staking rewards.

"The proposed trust will hold and stake the tokens, providing investors with the opportunity to earn staking rewards, which are paid out regularly by the Tron network," the filing stated, as reported by Benzinga.

The filing comes as several other firms are developing products focused on staking. These products are becoming increasingly popular with institutions, who are looking for ways to generate yield from their digital asset investments.

However, the success of this fund could hinge heavily on how the market perceives Tron's current valuation and trajectory.

Bearish Momentum Builds As TRX Slides Below Key Support

At the time of writing, TRX is trading at around $0.24, down 1.28% in the past 24 hours and nearly 3% over the week. The drop is supported by troubling on-chain data, including a fall in futures buy volume, now sitting at a weekly low of $6.5k, suggests retreating investor sentiment.

Moreover, funding rates have slid, reflecting a surge in short positions and lack of enthusiasm among bullish traders. Despite the ETF buzz, many investors seem unwilling to engage unless the market delivers a meaningful reversal in sentiment.

"Buyers are notably absent, and negative funding rates show traders are betting against recovery," an analyst at Messari stated.

The ETF proposal could eventually inject fresh institutional capital into Tron, which may stabilize or boost the token price. However, market skepticism remains high, with some analysts forecasting a potential retest of $0.23 if momentum doesn't improve.

While an ETF approval typically sparks optimism, the current macro and micro sentiment could delay any major rally. On the flip side, if market confidence recovers, TRX could reclaim levels near $0.259, but that would require a definitive shift in trading volume and funding dynamics.