US investment company Canary Capital has filed with the Securities and Exchange Commission (SEC) to launch a new Exchange Trade Fund (ETF) that combines a single investment product cryptocurrency with NFTs.
The proposed fund, Canary Pengu ETF, includes $Pengu tokens listed on the Solana blockchain and digital assets from the Ethereum-based Pudgy Penguins NFT collection, marking the first known attempt to include NFTs in US regulated ETFs.
The SEC filing was submitted on Thursday, but no review or approval timeline will be provided.
Source: Luca NetzWhat is an ETF?
An Exchange-Traded Fund (ETF) is a financial product that tracks the performance of a particular asset or group of assets.
ETFs are traded on stock exchanges and can be bought and sold like individual stocks. These are usually used to provide access to a particular sector, product, or index without requiring investors to directly purchase or manage the underlying assets.
In the cryptocurrency context, ETFs can provide exposure to digital tokens without requiring investors to directly process wallets, exchanges, or custody.
Source: Igloo Inc.Why is this important?
If approved, this will be the first ETF in the US to include NFTs as part of their portfolio. Previous digital asset ETFs, such as those tracking Bitcoin and Ethereum, only contain easy to rely on tokens.
NFTs are essentially different from cryptocurrencies due to their unique nature and variable pricing. Including them in a regulated investment fund presents new challenges, such as how to evaluate, preserve and audit such assets. The SEC has not yet issued any specific guidance on NFT-based ETFs.
Other companies, including Vaneck and Bitwise, have submitted proposals for ETFs related to cryptocurrencies such as Solana, Litecoin and XRP.
(tagstotranslate)$pengu
