The US financial watchdog, the Securities and Exchange Commission (SEC), has opened the floor for public feedback on a groundbreaking new investment product. This fund, proposed by Canary Capital, aims to track the cryptocurrency Injective (INJ) and also let investors earn rewards through “staking.” It’s a big move that could reshape how regular folks get involved with digital assets.
People now have 21 days to send in their thoughts about the proposed Canary Staked INJ ETF. After that, the SEC will take up to 90 days to decide what happens next. This timeline shows the careful approach regulators are taking with these new crypto offerings.
What Canary’s Plan Looks Like
Canary Capital first asked for approval back in July. They want to list and trade this new fund on the Cboe BZX Exchange. The idea is simple: the ETF would follow the price of Injective’s native token, INJ, and offer a way for investors to participate in staking. Staking is a process where crypto holders “lock up” their tokens to support the network and earn rewards.
The exchange, Cboe BZX, pointed out in an August 11 document that INJ has grown quite a bit, now boasting a market value over $1.4 billion. This larger size makes it harder for anyone to unfairly mess with its price. The proposal argues that because INJ is traded globally around the clock, manipulating its value would be tough and expensive. They even suggested that the Injective market might be safer from manipulation than some stock, bond, or even commodity markets.
A Good Time for Crypto ETFs?
This discussion comes at a time when the mood around crypto financial products seems to be shifting. We’ve seen many companies applying for ETFs that track different digital coins, like Dogecoin or Solana. This trend gained steam after Donald Trump’s presidency, which saw a different approach to crypto regulation.
More recently, the focus has moved to funds that include staking rewards. This shows how popular “liquid staking tokens” (LSTs) have become. These tokens let investors earn money on their crypto while still being able to use or trade their assets easily.
Just last week, VanEck, another big investment firm, filed for an ETF called JitoSOL. This fund would track the JitoSOL liquid staking token, which runs on the Solana network. The Jito Foundation even said this would be the first fund fully backed by a Solana LST. Back in July, REX-Osprey also announced that its Solana ETF would offer staking rewards through a partnership with JitoSOL. These moves highlight a growing race among money managers to launch ETFs tied to liquid staking tokens.
The SEC’s View on Staking
The SEC has been trying to make its position on staking clearer lately. In May, the agency said that most features of “proof-of-stake” systems actually fall outside its traditional power. Later, they clarified that certain types of liquid staking activities don’t necessarily count as issuing traditional securities.
If Canary’s ETF gets the green light, it would be a major milestone. It would give US investors a regulated way to get exposure to a staking asset. It could also set an important example for other similar products that are based on proof-of-stake networks. This situation really shows how US regulators are moving cautiously. They are looking at each new proposal carefully, thinking about how mature the asset is and how likely it is to be manipulated. Everyone in the industry will be watching closely to see the final decision. It could totally change how staking, traditional markets, and financial oversight work together.