Canary Funds has filed an amended S-1 registration statement with the U.S. Securities and Exchange Commission (SEC), confirming the asset lineup for its upcoming American-Made Crypto Exchange-Traded Fund (ETF). This innovative product will track the CoinDesk Made-in-America Index, which consists of cryptocurrencies that have U.S.-based foundations, teams, or mining activities. The updated filing, submitted on December 1, 2023, provides critical insights into the ETF’s operational structure and the assets it aims to include.
Details of the Amended Filing
The amended filing outlines how the American-Made Crypto ETF will function and clarifies its regulatory classification. The CoinDesk Made-in-America Index has been updated to comply with the SEC’s revised listing standards, which impose stricter criteria on the types of crypto assets eligible for inclusion in exchange-listed portfolios. As of November 26, 2023, the index consists of eight cryptocurrencies: HBAR, AVAX, BTC, LINK, LTC, SOL, XLM, and XRP. Each asset is weighted according to its market capitalization, with individual allocations capped at 20 percent and a minimum threshold of 1 percent.
The revised criteria have led to a focused selection of assets, ensuring that only those with a verifiable connection to U.S. operations are included. This includes requirements such as a U.S.-based management team or at least 25 percent of blocks mined by U.S. operators for proof-of-work tokens. As a result, popular large-cap assets like Bitcoin and Solana remain part of the index, while others have been excluded due to the new regulations.
Operational Structure of the ETF
The American-Made Crypto ETF is set to function as an exchange-traded product listed on Cboe BZX under the ticker symbol MRCA. The ETF will issue and redeem shares in large blocks, with authorized participants facilitating transactions. These participants will be responsible for delivering either cash or cryptocurrencies to acquire share baskets, while redemptions will follow a similar process.
The ETF’s primary aim is to replicate the performance of the Made-in-America Index. Additionally, the filing indicates a secondary objective of capturing network rewards, such as staking or transaction validation income, from supported assets. While this additional source of yield is not guaranteed, it could enhance the overall returns for investors.
The American-Made Crypto ETF represents a significant step toward integrating U.S.-based cryptocurrencies into mainstream investment vehicles. As the cryptocurrency market continues to evolve, initiatives like this aim to provide investors with greater access to assets that demonstrate a strong connection to the U.S. economy.