Two new exchange-traded funds (ETFs) of the cryptocurrencies litecoin (LTC) and hedera (HBAR) hit the US stock exchange today.
This unexpected debut occurs after the firm Canary Capital presented yesterday, October 27, necessary regulatory applications to the Securities and Exchange Commission (SEC).
The launch took the financial community by surprise because it took place despite the partial shutdown of US government activities, including the SEC, which operates with reduced staff.
The key to this move lies in the registration procedure. Canary Capital filed 8-A filings, a document that formally registers ETF shares under the 1934 Act for trading on a stock exchange. This step is as crucial as the S-1 registration statement, which registers securities under the 1933 Act.
Steven McClurg, CEO of Canary Capital, declared that they had had “several interactions with the SEC” about both filings over the last year, allowing them to be “fully prepared to act” before the government shutdown.
The strategy that allowed approval without manual intervention from the SEC, in the midst of the Government shutdown, was the inclusion of automatic effective clauses in the S-1 filings. Issuers allowed their amended S-1s to take effect automatically 20 days after filing. Although the usual thing is to wait for the SEC to declare effectiveness, the legal norm allows the S-1 to come into force automatically without direct intervention from the agency, explained journalist Eleanor Terrett.
McClurg announced that Canary Capital will not launch all of its registered products at once, but will instead introduce additional instruments in the coming weeks and months.
These new instruments are the first to be launched after the approval in 2024 of spot funds for the digital asset bitcoin (BTC) and ether (ETH), as reported by CriptoNoticias, marking an expansion in the offer of investment products based on digital assets available on Wall Street.
The launch of the LTC and HBAR ETFs positively impacted the price of these cryptocurrencies. In the last 24 hours, Litecoin had a rise of 2% and a rise of 14%.