Canary Capital Files Solana ETF, Joining TradFi Heavyweights VanEck and 21Shares

Former Valkyrie co-founder and CIO’s new firm files for Solana ETF within weeks of its inception.

Published: Oct 31, 2024 at 13:03

Institutional demand for Solana continues to rise, with a growing number of investment firms filing for spot Solana ETFs.

New filings from emerging firms have renewed excitement surrounding the prospect of Solana ETFs in the U.S., but regulatory concerns still loom large over the chances of SEC approval.

Who is Canary Capital, the newest player trying to bring Solana to TradFi markets?

Nascent Firm Files for Solana ETF

On October 30, Canary Capital filed an S-1 registration statement to the United States SEC (Securities and Exchange Commission). Canary Capital becomes the third U.S.-based investment firm to file for a spot Solana ETF, joining distinguished entities like VanEck and 21Shares.

Canary Capital’s filing accentuates the growing institutional demand for Solana, which has witnessed a meteoric surge in adoption and network activity within the blockchain industry in 2024.

Reinforcing their belief in the ecosystem, Canary Capital highlights Solana’s dominance in active address market share across leading blockchains.

solana active addresses

Canary Capital has based its thesis on onchain data, which suggests Solana has surpassed rivals BNB and Ethereum, including Layer-2s, in active addresses in recent months.

The recent filing is far from Canary Capital’s first crypto ETF application. The investment firm already filed applications for Litecoin ($LTC) and Ripple ($XRP) ETFs earlier in October.

Solana ETF Approvals Face Headwinds

Despite the success of Bitcoin ETFs, alternative cryptocurrencies like Solana still have plenty of regulatory obstacles to overcome before making their Wall Street debut.

Experts argue that the absence of existing Solana-based futures products and decentralization concerns are the chief reasons why we won’t see a Solana ETF anytime soon. Ahead of Bitcoin and Ethereum approvals, both assets were able to demonstrate sufficient decentralization and futures trading history.

Not all analysts share this view. Mathew Sigel, Head of Digital Assets Research at VanEck, maintains an optimistic outlook on the Solana ETF approval chances. Unfortunately, this didn’t stop the SEC from rejecting VanEck and 21Shares’ initial fillings in August 2024.

Meanwhile, the world’s largest asset manager is yet to lend its weight to the Solana ETF campaign. In July, Blackrock Chief Investment Officer Samara Cohen asserted that the TradFi giant had no interest in exploring a Solana ETF in the “near term”.

Off U.S. shores, Solana ETFs have found footing in Brazil. The Latin American nation currently boasts two spot Solana ETFs, listed by QR Asset and Hashdex.

What is Canary Capital?

While VanEck and 21Shares are both reputable investment firms, Canary Capital is still a relatively unknown entity in the financial world.

Created by former Valkyrie co-founder and Chief Investment Officer Steven McClurg, Canary Capital debuted in October 2024 with the launch of the Canary HBAR Trust. Since launching the U.S.’s first dedicated $HBAR investment vehicle, the firm has doubled down on crypto products with ETF filings for Litecoin, Ripple, and now Solana.

Canary Capital’s inception, led by a former Valkyrie executive, demonstrates TradFi’s growing interest in the cryptocurrency industry and suggests that further crypto-focused investment firms may launch in the future.