SEC Filing Document

Company: Canary Staked TRX ETF
Ticker: 
CIK: 2064768
Filing Type: S-1/A
Document Type: S-1/A
Date Filed: 2026-05-15
Accession Number: 0001999371-26-010857
Exchange: 
SIC Code: 6221
SIC Description: Commodity Contracts Brokers & Dealers
URL: https://www.sec.gov/Archives/edgar/data/2064768/000199937126010857/canary-s1a_051526.htm

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smart contract or may suffer a partial or total loss of any digital assets they have used to transact with the smart contract. Furthermore, the underlying smart contracts may be insecure, contain bugs or other vulnerabilities, or otherwise may not work as intended. Any of the foregoing could cause users of the DeFi application to be negatively affected, or could cause the DeFi application to be the subject of negative publicity. Because DeFi applications may be built on the Tron Network and represent a significant source of demand for TRX, public confidence in the Tron Network itself could be negatively affected, such sources of demand could diminish and the value of TRX could decrease. Similar risks apply to any smart contract or decentralized application, not just DeFi applications. Validators may suffer losses due to staking, or staking may prove unattractive to validators, which could make the Tron Network less attractive.

Validation
on the Tron Network requires TRX to be staked to elected validators known as Super Representatives, with staking controlled solely by
users who freeze TRX and delegate voting power. If the Tron Network experiences security vulnerabilities, protocol-level failures or malicious
behavior by Super Representatives, staked TRX may become inaccessible or unrecoverable. While the Tron Network does not currently implement
a slashing mechanism, validators are incentivized to perform accurately and maintain uptime in order to retain voting support. Poor performance
may result in removal from the active validator set and forfeiture of block rewards, impacting validator revenue and participation.

Although
the Tron Network does not penalize stakers by slashing their TRX, it includes certain restrictions that affect liquidity and validator
incentives. Staked TRX is frozen, and users must unfreeze their TRX to regain transferability, which triggers a mandatory three-day unbonding
period. During this time, staked TRX remains locked and inaccessible. Validators that lose community support or fail to maintain adequate
performance may lose election to the Super Representative set and become ineligible to produce blocks or receive rewards.

The
Tron Network also requires payment of transaction fees, which are satisfied through the consumption of Bandwidth and Energy resources.
During periods of high network activity, users without sufficient resources may need to burn TRX to complete transactions. As transaction
volumes increase, demand for these resources and associated TRX expenditures could affect validator and user incentives. Inadequate or
declining staking participation may reduce the security and stability of the network.

Additionally,
the limited liquidity of frozen TRX during the unbonding period may discourage participation from validators or stakers who require immediate
access to capital. If staking participation declines, the Tron Network may become less competitive relative to other blockchains, which
could negatively impact the demand for TRX and its long-term market value.

Proof-of-stake
blockchains are a relatively recent innovation, and have not been subject to as widespread use or adoption over as long of a period
of time as traditional proof-of-work blockchains.

Certain
digital assets, such as bitcoin, use a “proof-of-work” consensus algorithm. The genesis block on the bitcoin blockchain was
mined in 2009, and bitcoin’s blockchain has been in operation since then. Many newer blockchains enabling smart contract functionality,
including the Tron Network and the current ethereum network following the completion of the Merge in 2022, use a newer consensus algorithm
known as “proof-of-stake.” While their proponents believe that they may have certain advantages, the “proof-of-stake”
consensus mechanisms and governance systems underlying many newer blockchain protocols, including the Tron Network, and their associated
digital assets – including the TRX held by the Trust – have not been tested at scale over as long of a period of time or subject
to as widespread use or adoption as, for example, bitcoin’s proof-of-work consensus mechanism has. This could lead to these blockchains,
and their associated digital assets, having undetected vulnerabilities, structural design flaws, suboptimal incentive structures for network
participants (e.g., validators), technical disruptions, or a wide variety of other problems, any of which could cause these blockchains
not to function as intended, lead to outright failure to function entirely causing a total outage or disruption of network activity, or
to suffer other operational problems or reputational damage, leading to a loss of users or adoption or a loss in value of the associated
digital assets, including the Trust’s assets. Over the long term, there can be no assurance that the proof-of-stake blockchain on
which the Trust’s assets rely will achieve widespread scale or adoption or perform successfully; any failure to do so could negatively
impact the value of the Trust’s assets.

Operational
cost may exceed the award for validating transaction, and increased transaction fees may adversely affect the usage of the Tron
Network.

transaction fees become too high, the marketplace may be reluctant to use the Tron Network. This could result in decreased usage and limit
the expansion of the Tron Network in retail, commercial and payments applications, negatively impacting investment in the Trust. Conversely,
if the rewards for validators (i.e., Super Representatives) or the value of transaction fees are insufficient to incentivize participation,
validators may reduce activity or cease validating transactions altogether.

Ultimately,
if the cost of maintaining Super Representative infrastructure exceeds the value of rewards and user-delegated voting support, validators
may operate at a loss, transition to other networks or cease operations entirely. Each of these outcomes could impair transaction throughput
and network stability, which could adversely affect the performance of the Tron Network and reduce the value of TRX held by the Trust.

Unlike
some proof-of-stake networks, the Tron Network does not burn user transaction fees. Instead, users expend Bandwidth and Energy resources—acquired
by freezing TRX—or pay TRX directly when these resources are insufficient. If Bandwidth and Energy consumption becomes prohibitively
expensive during peak activity, it could reduce user demand for on-chain activity, impacting validator income over time.

significant drop in validator participation could reduce the collective throughput of the Tron Network, resulting in slower transaction
confirmation, higher congestion and increased vulnerability to disruption or malicious activity. If block production slows or becomes
less reliable, user confidence in the network could be undermined. Any reduction in validator engagement or loss of network responsiveness
could adversely affect the value of the Trust’s TRX holdings or the Sponsor’s ability to operate effectively.

Certain
promoters of TRX have a history of regulatory enforcement actions against them, and future similar actions may have a detrimental effect
on the value of TRX.

Justin
Sun, the founder of the Tron Blockchain, faced enforcement action by the SEC in 2023 for alleged violations related to the sale
of unregistered securities and other regulatory issues. The SEC accused him of misleading investors regarding the nature of certain
cryptocurrency offerings. The enforcement action led to heightened scrutiny of not just Sun but also the Tron platform and TRX.
Following the news of the SEC’s allegations and the actions taken, the value of TRX experienced significant volatility. The
enforcement actions by the SEC were ultimately dismissed and/or settled without any admission of wrongdoing.

the extent the SEC or another governmental agency brings further enforcement actions against Justin Sun or other Tron platform insiders
or promoters, TRX’s reputation and user engagement may be affected, influencing its long-term viability and sentiment among investors.
Any such events may result in a temporary or permanent decrease in the value of TRX.

Risks
associated with the Sponsor staking a portion of the Trust’s assets.

The
Trust intends to establish a program to stake a portion of the Trust’s assets through one or more Staking Providers. The
Staking Provider will provide hardware, software and services necessary to enable the Trust to establish nodes and stake the Trust’s
TRX on the Tron Network. As a result of any staking activity in which the Trust may engage, the Trust expects to receive certain
staking rewards of TRX, which may be treated for federal income tax purposes as income to the Trust. The Staking Provider exercises
no discretion as to the amount the Trust’s TRX to be staked or timing of the staking activities (other than as is incidental
in establishing or deactivating validator nodes). The Custodian will maintain exclusive possession and control of the private keys
associated with any staked TRX at all times. The amount of TRX the Trust may receive as reward for its staking activity can vary
significantly over time.