Analyst Questions Whether Canary Capital’s TRUMP Coin ETF Can Clear SEC Hurdles

Canary Capital has filed to launch an exchange-traded fund that would directly hold Official Trump (TRUMP), but some market observers say the product faces substantial regulatory obstacles that may prevent it from being approved.

The firm submitted a filing with the U.S. Securities and Exchange Commission outlining a Canary Trump Coin ETF that would purchase and hold the memecoin. TRUMP was introduced in January and quickly gained attention; by the time of the report it was ranked around the mid-50s by market capitalization and had fallen considerably from its January peak. CoinMarketCap listed the token at about $8.40 at the time the article was published.

Bloomberg ETF analyst Eric Balchunas publicly questioned how the fund could pass muster with regulators, noting that many ETF structures for crypto have required a futures product to be traded on an exchange for at least six months before approval — a condition he says does not appear to be met for TRUMP. Balchunas added that a different regulatory route may be possible under the Investment Company Act of 1940 for so‑called 40 Act funds.

The 40 Act pathway has been used by other issuers: for example, REX Shares relied on that structure to bring a Solana staking ETF to market, and REX has also filed for a TRUMP-tracking product that would gain exposure via shares in an offshore company. ETF industry participants have described that approach as a way to work around conventional SEC registration routes.

The token itself has sparked debate: critics argue it presents potential conflicts of interest because of its association with a sitting president and say it could be misused to attempt influence. Canary’s filing warns that the ETF’s shares would be speculative and may not be suitable for investors who cannot tolerate high risk. REX Financial’s leadership has likewise advised caution, noting that issuers should be selective about which cryptocurrencies they structure products around, especially outside the largest tokens.

Canary also completed administrative steps to form the legal entity for the proposed ETF with Delaware state authorities in mid‑August. The company will need to submit additional paperwork and navigate the SEC’s typical review process, which often takes many months to reach a decision.