Canary Capital has filed a second amendment to its application for a staked SEI exchange-traded fund, targeting 90% of its SEI holdings custodied by BitGo for staking rewards.
The fund intends to list on Cboe BZX, according to the SEC filing. The ticker symbol and sponsor fee structure remain undisclosed. Canary did not respond to requests for comment on the amended filing.
Staked ETFs allow investors to receive yield from blockchain validation without holding the underlying asset directly. Canary's approach mirrors strategies deployed in similar products tracking other proof-of-stake networks, where custodians hold tokens while the fund passes staking income to shareholders. BitGo, a regulated digital asset custodian, maintains the SEI holdings under standard institutional safeguards.
SEI, a layer-one blockchain designed for exchange and trading applications, has a market capitalization near $2.5 billion as of mid-September. The network uses delegated proof-of-stake, allowing token holders to earn rewards by delegating to validators. A staked ETF would make those rewards accessible to traditional equity investors who cannot manage wallet infrastructure or validator selection.
Canary's amendment comes as the SEC has moved to approve several staked cryptocurrency ETFs following the July 2024 spot Bitcoin ETF framework expansion. Bitcoin and Ethereum staking products have already launched or received conditional approval. Solana, another large proof-of-stake network, has seen multiple staking ETF applications advance through the regulatory pipeline.
The fund previously disclosed its intent to stake SEI in an earlier filing, but the 90% target and BitGo partnership detail appear in the current version. If approved, the product would compete with direct staking on decentralized platforms but offer custodial simplicity and regulatory clarity.
Cboe BZX, which hosts most U.S. cryptocurrency ETF listings, would be the venue for execution. The outcome hinges on SEC staff determining whether Canary meets listing standards for surveillance, custody, and redemption procedures. Canary's next disclosure window for ticker symbol and fee approval will clarify the fund's final structure.
