Canary Capital has made history by submitting a proposal to the SEC for the first-ever Hedera HBAR spot ETF. If this innovative fund receives approval, it will provide institutional investors with direct exposure to the HBAR token, significantly bypassing derivatives and futures.

The announcement of the filing caused a rapid surge in HBAR's value, which jumped over 24% within a short span, marking a new four-month high for the token. This showcases the immediate market impact such a proposal can have on the cryptocurrency involved.

The SEC filing details that the ETF will deliver cash returns to shareholders rather than HBAR tokens, simplifying the process for investors. Although Canary Capital hasn't specified the custodian, the firm is confident in its ETF structure, following its recent launch of an HBAR Trust for select investors.

Previously, Canary Capital has filed for spot ETFs including Litecoin, Solana, and XRP. The company is spearheaded by Steven McClurg, who also founded Valkyrie Funds. Valkyrie has managed several other notable spot crypto ETFs in the market.

Approaching regulatory hurdles remain a concern as the SEC's stance on crypto ETFs is yet to be fully determined, despite several Bitcoin and Ethereum ETFs receiving approval in previous months. Factors such as potential changes in SEC leadership add layers of uncertainty to this landscape.

In recent years, activity around crypto ETFs surged, further illustrated by exceeding trading volumes recorded for Bitcoin ETFs, surpassing $7.22 billion. Ethereum ETFs also experienced substantial cash inflows, bolstered by major players like BlackRock and Fidelity.