SEC Filing Document

Company: Canary Staked TRX ETF
Ticker: 
CIK: 2064768
Filing Type: S-1
Document Type: S-1
Date Filed: 2025-04-18
Accession Number: 0001999371-25-004423
Exchange: 
SIC Code: 6221
SIC Description: Commodity Contracts Brokers & Dealers
URL: https://www.sec.gov/Archives/edgar/data/2064768/000199937125004423/canary-s1_041825.htm

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in connection with such illegal off-exchange transactions, triggering an obligation to register with the CFTC, which the CFTC order asserts it violated. The CFTC previously fined Bitfinex in 2016 on similar charges. USDC is a reserve-backed stablecoin issued by Circle Internet Financial that is commonly used as a method of payment in digital asset markets. While USDC is designed to maintain a stable value at 1U.S. dollar at all times, on March 10, 2023, the value of USDC fell below $1.00 for multiple days after Circle Internet Financial disclosed that US $3.3 billion of the USDC reserves were held at Silicon Valley Bank, which had entered Federal Deposit Insurance Corporation (“FDIC”) receivership earlier that day. Stablecoins are reliant on the U.S. banking system and U.S. treasuries, and the failure of either to function normally could impede the function of stablecoins, and therefore could adversely affect the value of the Shares.

Given the foundational
role that stablecoins play in global digital asset markets, their fundamental liquidity can have a dramatic impact on the broader digital
asset market, including the market for TRX. Because a large portion of the digital asset market still depends on stablecoins such as Tether
and USDC, there is a risk that a disorderly de-pegging or a run on Tether or USDC could lead to dramatic market volatility in digital
assets more broadly. Volatility in stablecoins, operational issues with stablecoins (for example, technical issues that prevent settlement),
concerns about the sufficiency of any reserves that support stablecoins or potential manipulative activity when unbacked stablecoins are
used to pay for other digital assets (including TRX), or regulatory concerns about stablecoin issuers or intermediaries, such as exchanges,
that support stablecoins, or the removal or migration of prominent stablecoins away from the Tron Network, could impact individuals’
willingness to trade on trading venues that rely on stablecoins, reduce liquidity in the TRX market, and affect the value of TRX, and
in turn impact an investment in the Shares. Given that Bitfinex may be a component of the Pricing Benchmark and Bitfinex and Tether are
understood to be under common ownership and management, problems with Tether specifically could potentially affect pricing of transactions
on Bitfinex or otherwise disrupt Bitfinex’s operations.

Competition
From The Emergence Or Growth Of Other Digital Assets Or Methods Of Investing In TRX Could Have A Negative Impact On The Price Of TRX And
Adversely Affect The Value Of The Shares.

As of April 16,
2025, TRX was the 8th largest digital asset by market capitalization, as tracked by CoinMarketCap.com. As of April 16, 2025,
the alternative digital assets tracked by CoinMarketCap.com had a total market capitalization of approximately $2.7 trillion (including
the approximately $23.37 billion market cap of TRX), as calculated using market prices and total available supply of each digital asset,
excluding tokens pegged to other assets. TRX faces competition from a wide range of digital assets, including bitcoin and ethereum. TRX
is also supported by fewer regulated trading platforms than more established digital assets, such as bitcoin and ethereum, which could
impact its liquidity. In addition, TRX is in direct competition to other smart contract platforms, such as Ethereum, Polkadot, Avalanche
and Cardano. Competition from the emergence or growth of alternative digital assets and smart contracts platforms, such as EOS, Tezos,
Tron, and numerous others, could have a negative impact on the demand for, and price of, TRX and thereby adversely affect the value of
the Shares.

In addition, some
digital asset networks, including the Tron Network, may be the target of ill will from users of other digital asset networks. For example,
in July 2016, the Solana Network underwent a contentious hard fork that resulted in the creation of a new digital asset network called
Solana Classic. As a result, some users of the Solana Classic network may harbor ill will toward the Solana Network. If something similar
were to occur with respect to the Tron Network, its users may attempt to negatively impact the use or adoption of the Tron Network.

Investors may
invest in TRX through means other than the Shares, including through direct investments in TRX and other potential financial
vehicles, possibly including securities backed by or linked to TRX and digital asset financial vehicles similar to the Trust, or
other futures-based products. Market and financial conditions, and other conditions beyond the Sponsor’s control, may make it
more attractive to invest in other financial vehicles or to invest in TRX directly, which could limit the market for, and reduce the
liquidity of, the Shares. In addition, to the extent digital asset financial vehicles other than the Trust tracking the price of TRX
are formed and represent a significant proportion of the demand for TRX, large purchases or redemptions of the securities of these
digital asset financial vehicles, or private funds holding TRX, could negatively affect the Index, the Trust’s TRX holdings,
the price of the Shares, the net asset value of the Trust and the NAV.

Failure Of
Funds That Hold Digital Assets To Receive SEC Approval To List Their Shares On Exchanges Could Adversely Affect The Value Of The Shares.

There have been a growing
a number of attempts to list on national securities exchanges the shares of funds that hold digital assets. These investment vehicles
attempt to provide institutional and retail investors exposure to markets for digital assets and related products. The exchange listing
of shares of digital asset funds would create more opportunities for institutional and retail investors to invest in the digital asset
market. However, the SEC has repeatedly denied such requests. If exchange-listing requests continue to be denied by the SEC, increased
investment interest by institutional or retail investors could fail to materialize, which could reduce the demand for digital assets generally
and therefore adversely affect the value of the Shares.

Risks Associated
with Investing in the Trust

Investment-Related
Risks.

Investing
in TRX and, consequently, the Trust, is speculative. The price of TRX is volatile, and market movements of TRX are difficult to predict.
Supply and demand changes rapidly are affected by a variety of factors, including regulation and general economic trends, such as interest
rates, availability of credit, credit defaults, inflation rates and economic uncertainty. All investments made by the Trust will risk
the loss of capital. Therefore, an investment in the Trust involves a high degree of risk, including the risk that the entire amount invested
may be lost. No guarantee or representation is made that the Trust’s investment program will be successful, that the Trust will
achieve its investment objective or that there will be any return of capital invested to investors in the Trust, and investment results
may vary.

The
NAV may not always correspond to the market price of TRX.

The
NAV of the Trust will change as fluctuations occur in the market price of the Trust’s TRX holdings. Shareholders should be aware
that the public trading price per share may be different from the NAV for a number of reasons, including price volatility and the fact
that supply and demand forces at work in the secondary trading market for shares are related, but not identical, to the supply and demand
forces influencing the market price of TRX.

Authorized Participant may be able to create or redeem a Basket at a discount or a premium to the public trading price per share and the
Trust will therefore maintain its intended fractional exposure to a specific amount of TRX per share.

Different
from directly owning TRX.

The
performance of the Trust will not reflect the specific return an investor would realize if the investor actually held or purchased TRX
directly. The differences in performance may be due to factors such as fees, transaction costs, [proceeds from staking activities,] and
Pricing Benchmark tracking risk. Investors will also forgo certain rights conferred by owning TRX directly, such as the right to claim
air drops. See “A Temporary Or Permanent “Fork” or a “Clone” Of The TRX Blockchain Could Adversely Affect
The Value Of The Shares.”

Pricing
Benchmark tracking risk.

The
Trust may not achieve the desired degree of correlation between its performance and that of the Pricing Benchmark and thus may not achieve
its investment objective. The difference in performance may be due to factors such as fees, transaction costs, redemptions of, and subscriptions
for, Shares, pricing differences, differences in the timing of the addition or removal of constituent exchanges underlying the Pricing
Benchmark or the cost to the Trust of complying with various new or existing regulatory requirements.

Liquidity
risk.