The Nasdaq Spot Hedera (HBAR) ETF Filing

The Nasdaq Stock Market LLC, on behalf of Canary Capital, submitted a 19b-4 filing with the U.S. Securities and Exchange Commission (SEC) for a spot Hedera (HBAR) exchange-traded fund (ETF). This follows Canary Capital’s earlier S-1 registration for the fund in November, aiming to provide direct exposure to Hedera’s native cryptocurrency.

Regulatory Filing Process and Approval Timeline

The 19b-4 filing is the second regulatory step required for crypto ETFs. Upon acknowledgment by the SEC, it will be published in the Federal Register, starting a review period that will lead to a decision on approval, similar to other spot crypto ETFs.

Canary Capital’s initial S-1 registration in November indicated plans for an HBAR ETF. They amended the filing last week following SEC feedback, signifying ongoing regulatory discussions.

Hedera’s Network and Governance Structure

Hedera functions as a decentralized public network using the Hashgraph consensus mechanism for fast, secure transactions. Governed by a council of multinational corporations, it oversees network decisions and token allocations. The SEC filing clarifies that although Hedera isn’t primarily a payment system, it relies on a native token to facilitate operations and user participation, aligning with other public distributed ledger technologies.

Market Response to HBAR ETF Filing

Post-filing, Hedera’s token price slightly increased to around $0.22. Market participants are watching ETF developments closely, as similar approvals have historically affected asset prices. Bloomberg’s ETF analyst noted potential approval for HBAR and Litecoin, highlighting them as leading candidates for upcoming spot ETFs.

Canary Capital’s Litecoin ETF Progress

Canary Capital’s spot Litecoin ETF is now listed on the Depository Trust and Clearing Corporation’s (DTCC) website with the ticker symbol LTCC, marking progress in the ETF approval process. This listing follows Nasdaq’s earlier submission for the Litecoin ETF, with SEC awaiting public comments.

Significance of DTCC Listing and Regulatory Review

While the DTCC listing is a procedural step, it doesn’t ensure regulatory approval. Listed ETFs may remain in pre-launch status until cleared by the SEC. The review of crypto ETFs has accelerated recently, particularly following the approval of multiple spot Bitcoin ETFs. Analysts see issuer-regulator dialogue as vital for approval outcomes.

Bitcoin ETFs Market Insights

Recent reports show significant daily net outflows of -$937.78 million across Bitcoin ETFs, yet cumulative net inflow remains positive at $38.08 billion. Total assets of Bitcoin ETFs stand at $101.51 billion. BlackRock’s IBIT ETF leads with $51.42 billion, despite daily outflows.

What About Ethereum ETFs?

Ethereum ETFs experienced a daily net outflow of -$50.08 million, reducing cumulative total inflows to $3.03 billion. Total net assets for Ethereum ETFs are $9.30 billion, with varied trading volumes and price declines noted across all major ETFs.

Outlook for Exchange Traded Funds

The SEC’s handling of Canary Capital’s filings may provide insights into evaluating future altcoin ETFs. As regulatory frameworks evolve, applications for tokens beyond Bitcoin and Ethereum could set precedents for wider market adoption.