Canary Funds’ Bold Step: XRP Spot ETF Nears Auto-Approval Amid Nasdaq Review

Canary Funds has taken a significant step in its effort to launch a spot exchange-traded fund (ETF) focused on the XRP cryptocurrency. The asset management company recently submitted an updated S-1 registration for its planned ETF, notably removing a clause that previously allowed the U.S. Securities and Exchange Commission (SEC) to control the timing of the application’s effectiveness. This move could expedite the ETF’s potential launch, bringing it closer to realization.

### Canary XRP ETF Nears Automated Green Light

With the updated filing, the exchange-traded fund is positioned to become automatically effective through Section 8(a) of the Securities Act of 1933. According to industry sources, this set the stage for a possible debut date in mid-November. However, this timeline is contingent upon gaining the necessary listing approval from Nasdaq. Journalist Eleanor Terrett was among those reporting this development, suggesting that the ETF could go active around November 12, provided that everything else falls into place.

The revision to the filing indicates Canary’s strategic pivot to avoid an indefinite wait for SEC approval, a notable objective amid increasing interest in institutional-grade XRP products. As evidence of the rising interest, Evernorth recently commenced trading on Nasdaq under its XRPN ticker following a substantial purchase of XRP worth slightly less than $1 billion.

### Strategic Timing Amid Regulatory Slowdowns

This maneuver by Canary Funds occurs amid a partial government shutdown, slowing down various regulatory procedures. Removing the delay clause means Canary is ready to advance its ETF plans once the mandatory 20-day cooling-off period concludes. The ETF will only face delays if the SEC introduces new objections or feedback.

The intended ETF aims to offer structured access to XRP, subtracting operational costs and liabilities. Trading on Nasdaq and anchored to the CoinDesk XRP CCX index, this financial product promises to deliver a comprehensive overview of XRP market activities. Gemini Trust Company and BitGo Trust Company have been named custodians, underscoring the robust security and reliability of the underlying asset management approach.

### Bold Steps and Market Reactions

Market observers have assessed this filing tactic as audacious. Eric Balchunas of Bloomberg noted that Canary, unlike some other digital asset issuers, did not engage in prolonged comment consultations with the SEC, marking a difference from strategies adopted by other players like Solana. This approach, while risky, is being recognized as potentially groundbreaking.

Some experts view the filing’s timing as a calculated bid to accelerate market entry, leveraging current decentralized finance (DeFi) trends. Notably, Fred Smith, a seasoned market analyst, described Canary’s approach as pioneering. He highlighted how this signifies a growing appetite for diverse crypto-related financial instruments tailored for institutional investors.

### Expanding ETF Market Landscape

If Canary successfully launches this XRP-centric financial instrument without facing SEC hurdles, it would represent a landmark moment within the digital currency sphere and expand the utility of XRP in institutional portfolios. Such a launch could catalyze renewed interest and participation in other cryptocurrency-based ETFs, including recently proposed offerings from major financial entities.

As the ETF market broadens, similar filings featuring a variety of cryptocurrencies have surfaced. For instance, T. Rowe Price recently submitted an application for a crypto ETF consisting of Bitcoin, Ethereum, Solana, and XRP. This illustrates a broader trend, with other tokens like Hedera and Litecoin also entering the foray through similar mechanisms.

The landscape for cryptocurrency-based ETFs is rapidly evolving, with various assets now being packaged into diversified investment products. This reflects a growing institutional appetite for regulated and structured access to digital currencies within traditional financial markets. The steps taken by Canary, if successful, could inspire further innovations and competitive entries into this burgeoning segment.