Canary Capital’s Staked ETF Filing: TradFi Meets DeFi, or a Recipe for Disaster?

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Ah, the sweet scent of progress! Investment company Canary Capital has filed an S-1 application for a staked INJ (INJ) exchange-traded fund (ETF) with the United States Securities and Exchange Commission (SEC) on Thursday. 📈💰

INJ, the governance, staking, and utility token for the Injective Protocol, is a layer-1 blockchain network focused on decentralized finance (DeFi) operations. Canary Capital’s main objective is to accrue staking rewards through providing validation services using an “approved staking platform.” 💸🔒

Canary Capital formed a Delaware Trust for its staked Injective ETF in June, hinting at plans for the altcoin investment vehicle. The application marks the latest altcoin ETF filing in the US. 📝🦅

The application also reflects the convergence of traditional and decentralized finance (DeFi). This trend accelerated following guidance from the SEC classifying staking rewards as income and not securities transactions subject to capital gains, opening the door for asset managers to act as validators through delegated staking. 🤝📈

The line between TradFi and DeFi blurs, polarizing the crypto community

Traditional and decentralized finance are converging into a unified sector, according to Nelli Zaltsman, the head of blockchain payments innovation at Kinexys, a real-world asset tokenization platform launched by banking giant JPMorgan. 🏦🌐

Zaltzman told the audience at the RWA Summit 2025 in Cannes, France, that the separation between the two areas of finance may disappear within a few years. This convergence between digital and traditional finance also opens up opportunities for retail investors to access previously inaccessible investments, including private equity, blurring the line between accredited and retail investors, CoinFund President Christopher Perkins told CryptoMoon. 🤑📈

Other crypto investors have argued that merging the two sectors was inevitable and that mass adoption will come through the merger of the two worlds. Not everyone in the crypto community is convinced by this positive outlook, however. 🤔😒

“Institutions and ETFs are bad for crypto,” investor Nick Rose wrote on X. “Everyone cheers inflows like it’s free money, but Wall Street doesn’t HODL, they hedge, rotate, and dump when risk models say ‘exit’.” 🏦💸

“Institutions manage exposure, take profits, rebalance portfolios, etc. Crypto wasn’t built for quarterly reports,” he said. 📈📉

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2025-07-18 01:17