Canary Capital Proposes First-Ever Hedera HBAR Spot ETF to SEC, Triggering 24% Surge in HBAR Value

Canary Capital, a crypto investment firm, has submitted a proposal to the SEC for a Hedera HBAR spot exchange-traded fund (ETF). This is the first of its kind.

If the SEC approves it, institutional investors will get direct exposure to the HBAR token. Exciting news! After the announcement, HBAR’s value jumped by over 24% in just one hour, hitting a four-month high.

Certain conditions come with the HBAR ETF. According to the SEC filing, the ETF will hold HBAR directly. This means it won’t use derivatives, futures, or other financial instruments. Instead of receiving HBAR, shareholders will get cash proceeds. This simplifies transactions. However, the filing doesn’t mention who will act as the custodian or administrator for the fund.

This proposal follows the launch of an HBAR Trust by Canary Capital for accredited investors last October. The firm, led by Steven McClurg, has also filed for spot ETFs related to Litecoin, Solana, and XRP. McClurg is known for founding Valkyrie Funds, which manages several spot crypto ETFs.

The filing also outlines conditions that could lead to the Trust’s termination. If the ETF’s shares get delisted and aren’t relisted within five days, or if regulators classify the Trust as an investment company or commodity pool, operations will stop.

The SEC’s stance on crypto ETFs remains unclear. Earlier this year, they approved 11 Bitcoin ETFs and eight Ethereum ETFs, but future approvals are uncertain.

This regulatory uncertainty comes alongside speculation about SEC Chair Gary Gensler potentially leaving his position. This speculation follows Trump’s return to the presidency, as he has indicated he would replace Gensler if elected.

Since the 2024 US election, crypto ETFs have seen a surge in activity. Bitcoin ETFs recorded over $7.22 billion in trading volume. Ethereum ETFs also saw inflows of $295 million, with significant investments from firms like BlackRock and Fidelity.

In a notable achievement, BlackRock’s Bitcoin ETF (IBIT) has recently surpassed its Gold ETF in size. This comes as Bitcoin hits an all-time high, reinforcing its reputation as “digital gold.” Meanwhile, gold itself is trading at its highest level since 1980.