Memecoins continue to break new boundaries. Canary Capital has filed an application to launch a spot ETF on PEPE in the United States.
This is an unusual step. An institutional product is being offered for an asset that is still 85% below its all-time high.
ETF on Memecoin Becomes a Reality
The company has filed an S-1 form with the SEC for the CANARY PEPE ETF product. The fund will directly track the price of PEPE, and the tokens themselves are planned to be stored with a custodian.
The structure also provides for the use of Ethereum. Up to 5% of the fund’s assets may be held in ETH to pay network fees.
This approach is already familiar to the market. But the choice of asset itself looks much riskier.
PEPE Remains Far From Its Peaks
Despite growing interest, the token price remains significantly below its highs. Since December 2024, PEPE has lost about 85% of its value.
At the same time, over the past month, the asset has shown moderate growth of about 6%. This indicates that the market is still in a stabilization phase, not a new impulse. Interest remains, but it does not appear to be widespread.
Token Concentration Raises Questions
An important risk factor is the ownership structure. About 41% of the supply is concentrated in the ten largest wallets. This makes the market vulnerable.
Any large movement by these holders could sharply change the price. For an institutional product, this is a serious point. Such risks are hard to ignore.
Canary Expands Product Lineup
The company already works with a number of other assets. Its portfolio includes products related to XRP, Solana, Hedera, and Sei. An application for an ETF on a smaller memecoin was also previously submitted. This shows the company’s strategy. Canary is betting on expanding its lineup and testing demand for riskier assets.
ETF Becomes a Reason for Interest in Altcoins
The market sees new ETFs as a possible trigger for the next altcoin cycle. Expanding the product lineup could attract additional capital.
But the structure of demand is changing. Institutional investors more often choose assets with yield or a clear economy. Against this backdrop, memecoins remain a controversial segment.
Regulatory Factor Remains Key
The development of the ETF market directly depends on regulation. In the US, discussions of new rules continue, including the CLARITY Act.
The speed of decision-making remains low. This holds back the launch of new products and creates uncertainty.
In addition, the rules for using tokens and networks themselves continue to change. This affects demand and the structure of the market.
What’s Next?
The application for a PEPE ETF shows how far the market has come. Even high-risk assets are beginning to receive an institutional wrapper.
But the success of such a product is not guaranteed. Supply concentration, a weak fundamental base, and high volatility remain key risk factors.
If the product is approved, it could open the door for other similar ETFs. If not, the market will receive a signal about the limits of institutional interest. For now, this is an experiment. And the market will be watching its outcome closely.
