Innovative breakthrough in native US encryption asset ETFs: Canary Capital submits UNI/LINK/SOL combination ETF application, Grayscale applies for AVAX trust conversion.

Canary Capital submitted a revolutionary "Made in America Crypto ETF" application to the SEC, focusing on domestic tokens such as UNI, LINK, and SOL, while also resubmitting the XRP Spot ETF application. Grayscale joins the wave of innovation by applying to convert the Avalanche private sale fund into a Nasdaq-listed ETF. These actions bring a diversified product matrix to the crypto ETF market beyond Bitcoin and Ethereum, indicating that 2025 will be the year of explosive growth for thematic crypto ETFs.

[US Native Cryptocurrency ETF Innovation Plan]

Canary Capital submitted a groundbreaking application to the U.S. Securities and Exchange Commission (SEC) last Friday, planning to launch a Spot ETF focused on U.S. native tokens—the Canary American-Made Crypto ETF (ticker: MRCA). This product will track the "U.S. Made Blockchain Index" and will be listed for trading on the Cboe BZX Exchange. According to the filed documents, eligible assets must meet one of three criteria: originally created in the U.S., minted through local validation methods such as proof of work or proof of stake, or the core operation of the protocol is based in the U.S. Representative tokens such as Uniswap (UNI), Chainlink (LINK), and Solana (SOL) may be included in the portfolio.

[Analysis of ETF Product Innovation Trends]

Bloomberg's senior ETF analyst Eric Balchunas pointed out that such innovative proposals will drive the cryptocurrency ETF market into a "portfolio innovation phase," resulting in product forms that are completely different from the current Bitcoin and Ethereum ETFs. He emphasized on social media: "As we predicted, based on category success, the market will welcome a variety of imaginable ETF portfolio solutions." However, he also acknowledged that there is uncertainty regarding the specific token selection criteria and suggested using an exclusion method to identify mainstream tokens that do not meet the criteria.

The ETF adopts a Delaware statutory trust structure, issuing continuous shares representing beneficial interests, registered under the Securities Act of 1933. Unlike mutual funds governed by the Investment Company Act of 1940, investors do not enjoy the protective provisions of traditional regulated investment companies. In addition to passively tracking indices, the trust may also obtain secondary income by participating in network validation activities.

[XRP ETF application progress and regulatory background]

Canary Capital has resubmitted the amended S-1 application for the Canary XRP ETF. The fund will directly hold the native Ripple token XRP, using the CoinDesk XRP CCIX New York rate as the benchmark, and also plans to list on the Cboe BZX exchange.

The increasing expectations of institutions regarding the approval of the XRP fund stem from the SEC's formal withdrawal of the remaining appeal against Ripple in early August, ending the legal dispute that began in December 2020. In July 2023, Judge Analisa Torres issued a split ruling in the SEC v. Ripple case, determining that XRP is considered a security when sold to institutional investors but not when traded on public exchanges. About a year later, the court imposed a fine of $125 million on Ripple.

After Trump was elected the 47th president of the United States, a friendlier SEC and Ripple jointly requested Torres to lift the ban and reduce the fine to $50 million. However, the federal judge rejected the request, stating that neither party had proven the existence of a "special circumstance" that outweighed the public interest, upholding the original ruling and the $125 million fine.

[Collective Action by Institutions and Market Impact]

The application for institutional membership by Canary includes the registration statement submitted by competitor Grayscale Investments, requesting to convert the existing private Avalanche fund into a publicly traded trust. These actions indicate that institutions are actively laying out a product matrix for the post-Bitcoin ETF era, aiming to meet the diversified needs of investors through thematic and segmented products.

[Conclusion]

The proposal of native crypto asset ETFs in the United States marks the beginning of a new stage in the innovation of crypto products, shifting from single assets to composite configurations, and from general types to thematic types. With the regulatory environment gradually becoming clearer and the level of institutional participation increasing, 2025 is expected to witness a concentrated explosion of multi-asset crypto ETFs. Although there is still uncertainty regarding specific Token compliance standards, the wave of product innovation will drive the entire industry towards a more refined and institutional direction, providing investors with richer digital asset allocation tools.