Canary Capital has filed an application with the US Securities and Exchange Commission (SEC) to launch the first Hedera Cryptocurrency exchange-traded fund (ETF) (HBAR).
According to the document sent to the SEC, the objective of this ETF is to offer investors direct exposure to the value of HBAR, with the clarification that ownership of this cryptocurrency does not grant rights to business profits or derived income.
HBAR ETF Features
The application highlights that HBAR, Hedera’s digital asset, is registered on a decentralized ledger. Additionally, Canary Capital clarifies that all cryptocurrencies acquired under this fund will be guarded by a yet undisclosed entity.
Hedera, the network on which HBAR operates, facilitates online transactions in a secure and decentralized manner, eliminating intermediaries and protecting users’ personal data.
«HBAR is essential for the operation of the Hedera network. Not only does it protect the network against cyberattacks through distributed consensus, but it also acts as the ‘fuel’ necessary to pay for the resources that keep the network running,” Canary Capital details in its application.
Potential risks and expectations of the ETF
Canary Capital stresses that although HBAR has seen recent growth, there is no guarantee that its adoption will continue to increase. “A decrease in the use of HBAR could increase its volatility or reduce its value, thus affecting the ETF’s share price,” the firm warns.
This move towards an HBAR ETF is not Canary Capital’s first step into cryptocurrency ETFs, as it previously explored applications to launch exchange-traded funds of other altcoins such as XRP and Litecoin, expanding its offering in the crypto space.
HBAR reached a 32% increase after the announcement
The news of the ETF filing had an immediate effect on the market: the value of HBAR increased by 32%, reaching price levels of $0.073. At the time of writing it corrects to $0.065. Although HBAR remains below its all-time high of $0.50 in September 2021, the announcement fueled renewed confidence in the cryptocurrency.
Evolution of HBAR in the last 24 hours. Source: CoinMarketCap
This enthusiasm in the market adds to a recent rally in the crypto ecosystem, led by the rise of Bitcoin to levels close to $90,000 following Donald Trump’s election victory.
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