AXL Soars: Canary Capital Files for Axelar ETF
AXL Soars on Canary Capital's ETF Filing
Axelar (AXL), the native cryptocurrency of the Axelar Network, experienced a 14.3% price jump, reaching $0.44, following the news that asset manager Canary Capital filed an S-1 registration statement with the SEC to launch an AXL-based exchange-traded fund (ETF).
This marks the first-ever ETF filing for AXL, signifying a potential leap towards greater institutional adoption of the token. The filing, submitted on March 5, details that the fund's net asset value (NAV) will be calculated based on AXL's price. However, details such as the listing exchange, ticker symbol, and custodian remain undisclosed.
Canary Capital's Strategy
The proposed ETF builds upon Canary Capital's previous efforts to introduce Axelar to institutional investors. On February 19, the firm launched the Canary AXL Trust, a precursor to this ETF initiative. Canary Capital CEO Steven McClurg stated, "With Axelar driving some of the most advanced interoperability solutions in Web3, we see in AXL a significant opportunity for institutional investors to gain exposure to the technology underpinning next-generation blockchain connectivity."
Trading volume for AXL also saw a significant spike, increasing 131.8% from the previous day to $35.7 million. Axelar currently holds a market capitalization of $405.5 million and ranks 174th on CoinGecko.
The Crypto ETF Landscape
Canary Capital's filing contributes to the broader surge in cryptocurrency ETF applications in the US, a trend amplified since Donald Trump's return to office. Kaiko Research reports over 45 crypto ETF filings currently awaiting SEC approval.
While Bitcoin (BTC) and Ethereum (ETH) ETFs have dominated the landscape, the spectrum is expanding to encompass various assets, including meme coins. Bitwise and Grayscale have filed for a Dogecoin (DOGE) ETF, and other filings include newer meme coins like Official Trump (TRUMP) and Melania Meme (MELANIA).
Challenges for Altcoin ETFs
Kaiko Research highlights challenges for non-BTC/ETH ETFs, including shallow liquidity, susceptibility to price manipulation and volatility, and issues with transparency and regulatory oversight due to offshore trading activity. The lack of sufficient USD trading pairs and regulated futures markets further complicates accurate ETF valuations and available trading strategies.
Kaiko notes that these factors "could limit the demand for more crypto-related ETFs going forward." The success of AXL's ETF, and others like it, remains uncertain.
Codeum Note: Codeum provides comprehensive blockchain security solutions, including smart contract audits, KYC verification, and custom smart contract development to help build a secure and transparent blockchain ecosystem.
Disclaimer: This information is for educational purposes only and is not financial advice. Readers should conduct independent research and consult with a financial professional before making any investment decisions.