Canary files for spot $HBAR ETF with Nasdaq

Nasdaq has filed Form 19b-4 with the US Securities and Exchange Commission (SEC) seeking approval to list and trade shares of the Canary HBAR exchange-traded fund (ETF). The investment product aims to track the spot price of Hedera’s HBAR token, currently the 19th largest cryptocurrency by market capitalization on CoinGecko.

According to Senior Bloomberg ETF analyst Eric Balchunas, the filing follows Canary Capital’s S-1 amendment shared with the SEC on February 21. The investment firm submitted its plea to introduce the HBAR investment product in the US in November 2024, after launching the first HBAR Trust.

Interesting: Canary just filed an amended S-1 for their HBAR ETF, usually you only amend after comments from SEC. This echoes Litecoin, which also did ammendment. In flip, no 19b-4 yet. Need that to get that going. pic.twitter.com/hMU3Hetf1G

— Eric Balchunas (@EricBalchunas) February 21, 2025

Nasdaq’s move comes on the backdrop of growing interest in crypto exchange-traded funds from traditional financial institutions. Balchunas noted that Canary Capital is also advancing a spot Litecoin ETF, which is reportedly approaching potential SEC approval for listing and trading.

SEC scrutiny and positive market sentiment on crypto ETFs

This year, Canary Capital extended its ETF ambitions beyond HBAR and Litecoin to submit filings for spot XRP and Solana ETFs. The SEC has acknowledged the XRP ETF filing, and experts are confident the regulator to give the green light in the last quarter of 2025.

During the Biden administration, financial authorities in the US were cautious about crypto-based ETFs, resonating their worries over the integrity of the market, volatility, and investor protection. The weight was finally lifted in January last year when the SEC approved 12 spot Bitcoin ETFs.

Bloomberg ETF analysts James Seyffart and Eric Balchunas estimate that the HBAR ETF has only a 65% chance of approval, making it the least likely among recently proposed crypto ETFs. In contrast, Litecoin’s ETF leads with a 90% approval probability, followed by Dogecoin at 75% and Solana at 70%. The SEC has until October 2025 to decide on these filings.

Still, regulatory uncertainty surrounds XRP, which has been entangled in a prolonged legal battle over its classification as a security or a commodity with the SEC.

Bitcoin ETFs face second consecutive week of outflows

Data from SoSoValue shows that spot Bitcoin ETFs recorded a fourth consecutive day of net outflows on the business week that ended on February 21, shedding a combined $62.77 million. The week’s total outflows amounted to $559.41 million, bringing the two-week total to approximately $1.14 billion.

BlackRock’s iShares Bitcoin Trust (IBIT) was the exception to the rule, posting $21.64 million in net inflows. IBIT continues to lead the market with $40.88 billion in cumulative net inflows and $55.85 billion in total net assets. The VanEck Bitcoin ETF (HODL) also registered meager inflows of $4.71 million.  

On the flip side, Fidelity’s Wise Origin Bitcoin Fund (FBTC) saw $12.47 million in outflows, reducing its cumulative net inflows to $12.33 billion and its net assets to $19.68 billion.

The Bitwise Bitcoin ETF lost $16.58 million, while the Grayscale Bitcoin Trust (GBTC) experienced $60.08 million in net outflows, bringing its cumulative net outflows to $22.11 billion and reducing its total assets to $18.84 billion.

According to CoinShares’ report published on Monday, the sustained outflows mark the second consecutive week of investor withdrawals, following an 18-week period of inflows that had amounted to $29 billion.

Ethereum ETFs resilient to market downturn

Ethereum-based funds narrowly avoided a second consecutive week of net outflows. While they recorded $8.92 million in withdrawals on February 21, small inflows earlier in the week allowed them to post a net gain of $1.61 million for the period.

The Bitwise Ethereum ETF (ETHW) was the only Ethereum fund to see significant movement, logging $8.92 million in outflows after more than a week of neutral trading activity. 

ETHW’s cumulative net inflows now stand at $338.63 million amassing total net assets of $270.53 million. It ranks fourth among Ethereum ETFs for cumulative net inflows and fifth for total assets.

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