What Happened?
Digital asset investment firm Canary Capital has submitted an application, aiming to launch the “PENGU ETF” involving the Pudgy Penguins project, marking the first cryptocurrency ETF related to NFTs.
The ETF will primarily invest in the Pudgy Penguins NFT series and the project’s native token $PENGU, while also holding both Solana (SOL) and Ethereum (ETH) tokens.
Following the announcement of the ETF application, the price of $PENGU and the floor price of Pudgy Penguins NFTs saw a slight increase. The project’s CEO remarked that this is a historic moment.
Canary Capital Submits Pudgy Penguins ETF Application
Digital asset investment company Canary Capital has formally submitted the S-1 form to the U.S. Securities and Exchange Commission (SEC) with the aim of applying for a PENGU ETF, which includes Pudgy Penguins NFTs and the project’s native token $PENGU.
This ETF will primarily allocate funds to the Pudgy Penguins NFT series and $PENGU. Additionally, the fund will also hold two cryptocurrencies, Solana (SOL) and Ethereum (ETH), to facilitate the purchase, sale, and transfer of $PENGU and NFTs.
$PENGU is the governance token within the Pudgy Penguins ecosystem, currently valued at approximately $435 million. According to reports, following the announcement of the ETF application, the price of $PENGU increased by over 7%, reaching $0.0073, while the floor price of Pudgy Penguins NFTs grew by more than 0.5 Ethereum during the same period.
Luca Netz, CEO of Pudgy Penguins, also shared the submitted form from Canary Capital on X, calling it “a historic moment,” as this is the first cryptocurrency ETF involving an NFT project.
Furthermore, the parent company of the project, Igloo Inc., believes that Pudgy Penguins symbolizes the mainstream and large-scale application of blockchain technology. Their inclusion in the ETF application document demonstrates their confidence in the project.
Market Demand in Question?
In fact, this is not the first time that Canary Capital has submitted an application for a relatively “niche” crypto ETF. For instance, the Hedera (HBAR) ETF in November 2024, along with the recent Axelar (AXL) and Sui (SUI) ETFs, showcases Canary Capital’s ambition to break from tradition. The company aims to expand the range of investments for investors beyond mainstream assets like Bitcoin (BTC) and Ethereum, while also testing the SEC’s reaction to such innovative products.
Despite this, crypto researcher Alex Krüger criticized on X, stating, “After the announcement of the PENGU ETF application, the price didn’t rise significantly; new crypto ETFs have become a trivial joke.” He believes that such products cannot successfully attract a large amount of assets under management (AUM) for issuers, leading to financial losses.
Additionally, the fluctuating policies of the U.S. government have created an unclear regulatory environment for cryptocurrencies. While the Trump administration expressed a desire to make the U.S. the “global crypto capital,” during the tenure of former President Joe Biden, U.S. regulatory agencies initiated over 100 enforcement actions against crypto companies, adding uncertainty to the future regulations surrounding crypto products.
However, although market reactions are mixed, Canary Capital’s innovative move quietly opens a new chapter for crypto asset investment and sparks further discussions about the feasibility of investing in digital assets.
Source: Cointelegraph, CryptoSlate