Market News

SEC Considers Cboe's Spot Bitcoin ETF with Staking Exposure to TRON's TRX

Cboe has submitted a proposal to the SEC to launch a unique spot exchange-traded fund (ETF) focused on TRON's native cryptocurrency, TRX, incorporating staking rewards.

This ETF aims to tap into TRON's $25 billion market while addressing the SEC's evolving regulatory concerns around cryptocurrency assets.

The proposed structure would allow the ETF to hold TRX securely in cold storage, utilizing a third-party custodian to align with SEC custody requirements.

Cboe argues that TRX's decentralized design and inherent trading surveillance measures mitigate manipulation risks, similar to those associated with approved Bitcoin and Ethereum ETFs.

The plan includes novel cash-only creation/redemption methods, with trading conducted based on the net asset value calculated through Coindesk's TRX pricing benchmarks.

Cboe’s extensive SEC filing underscores TRON’s delegated proof-of-stake model and its resistance to supply shocks, which could result in more stable pricing.

If approved, this ETF would be a significant milestone as it would be the first U.S.-listed product to offer staking exposure to TRON’s TRX, emphasizing the cryptocurrency's increasing mainstream acceptance.

The SEC now has a 45-day window to review Cboe’s proposal as it continues to assess various crypto-based fund applications.

With institutional interest in crypto assets rising and regulatory frameworks maturing, the outcome could have far-reaching implications for the investment landscape.

In the backdrop, Bitcoin’s performance remains pivotal as investors closely monitor developments in the regulatory space to shape their strategies.