HBAR on the Rise: SEC Moves Forward with Nasdaq’s Trust Proposal

The United States Securities and Exchange Commission (SEC) has officially approved Nasdaq’s Rule 19b-4 filing for a commodity trust that includes HBAR. The trust structure is intended to provide investors with regulated exposure to the native currency of the Hedera Network, HBAR. This is an important milestone towards institutional adoption but differs from a spot exchange-traded fund (ETF) in that it does not allow direct redemptions. Therefore, shares can be sold and purchased at a premium or discount to the underlying asset’s value.

How the HBAR Commodity-Based Trust Works

This trust directly holds HBAR, with its shares representing fractional ownership of the total HBAR holdings. Unlike traditional ETFs, this structure does not offer direct redemptions. This means that while investors can buy and sell shares of the trust, the price may not always match the true market value of HBAR.

BNY Mellon Asset Servicing is set to oversee the administration and transfer agent duties of the trust. Meanwhile, CSC Delaware Trust Company will act as the trustee, and Coinbase Custody Trust Company will manage asset custody. Currently, Grayscale and Canary Capital are the only asset managers actively pursuing HBAR-based ETFs, signaling growing institutional interest in the asset.

SEC’s Decision on Other Crypto ETFs

While the SEC acknowledged the Nasdaq filing for the Grayscale Hedera Trust, it simultaneously delayed its decision on other cryptocurrency ETFs. This includes Grayscale’s XRP ETF and Cboe BZX Exchange’s spot Solana ETF. The regulator has extended the review period for these applications until May. However, Bloomberg ETF analyst James Seyffart considers the delay a routine part of the SEC’s review process rather than a setback.

Recently, the SEC has encountered a wave of ETF applications spurred by political changes, notably the resignation of former SEC Chair Gary Gensler and the unfolding of the latest U.S. election cycle. This influx of applications has led to extended review periods for a range of crypto-related investment products.

Bitwise Launches New Bitcoin ETF

Apart from activities within the HBAR ecosystem, Bitwise also introduced its new Bitcoin Standard Corporations ETF on March 11. The ETF is meant to track publicly traded companies that have at least 1,000 BTC in corporate treasuries. By investing in such companies, this ETF offers indirect exposure to Bitcoin without the direct purchase of assets.

With increasing asset managers entering the crypto ETF arena, institutional demand for digital assets continues to rise. Further launch of other cryptocurrency-based funds can further legitimize digital currencies and raise mainstream acceptance in the financial universe.

HBAR’s Market Reaction to the News

Once the Securities and Exchange Commission recognized Nasdaq’s filing, HBAR received a good market response. The token added more than 7% in the last 24 hours, reflecting investor confidence. Considering this acknowledgment, the SEC has begun a 21-day public comment period. The period allows industry players and the general public to offer their opinions on the proposal.

Following the public opinion period, the SEC will determine whether or not to approve, deny, or extend the review period. The determination can be of substantial importance to the acceptance of HBAR and inclusion in institutional investor portfolios.

With maturing cryptocurrency regulations, new investment vehicles like commodity-based trusts and ETFs lead the way for increased adoption. Investors will be keenly watching the SEC’s approach to these filings in the coming months.