Canary Capital Expands Crypto ETF Suite with Spot PEPE Application

Canary Capital has submitted a Form S-1 to the US Securities and Exchange Commission (SEC) to launch an exchange-traded fund (ETF) tracking the price of the PEPE memecoin. The proposed fund would utilize a custodian to hold the underlying PEPE assets and may maintain up to 5% of the trust's assets in Ether (ETH) to facilitate network transaction fees. This move is part of a broader strategy by Canary Capital to diversify its crypto offerings, which already include filings for assets such as Solana, XRP, Hedera, and Sei. The application suggests an attempt to capture institutional interest in high-volatility memecoins, despite ongoing debates regarding the viability of traditional altcoin cycles. The filing arrives at a challenging time for the asset; PEPE is currently trading approximately 85% below its December 2024 peak of $0.00002368. Furthermore, Canary Capital warned potential investors of significant concentration risk, noting that as of January 2026, the ten largest wallet addresses controlled roughly 41% of the circulating supply. Market precedents for memecoin ETFs have been mixed. Grayscale’s Dogecoin ETF, launched in November, significantly underperformed initial volume expectations, recording only $1.4 million on its first day against analyst predictions of $12 million. While some industry experts anticipate a surge in filings throughout 2026 driven by potential legislation like the Clarity Act, others argue that institutional demand has shifted toward yield-bearing instruments rather than speculative tokens.