Canary Capital has filed a Form S-1 with the US Securities and Exchange Commission to launch a spot exchange-traded fund tied to the PEPE memecoin. The proposed CANARY PEPE ETF would track the performance of PEPE, with all holdings kept by a custodian. The filing also notes that the trust may hold up to 5% of its assets in Ether to cover transaction fees on the Ethereum network.
Canary Capital already offers several crypto ETFs tracking assets including XRP, Solana, Hedera, and Sei. The firm has been active in filing for ETFs tied to lesser-known tokens, including a November 2025 application for an ETF tracking Mog Coin, ranked 353rd by market capitalization. By comparison, PEPE currently ranks 45th among all cryptocurrencies.
PEPE is a memecoin based on the internet character Pepe the Frog and gained significant social media attention in 2024. The token’s market capitalization is roughly 9% that of Dogecoin, the largest memecoin by market cap. Despite its cultural popularity, PEPE is currently down nearly 85% from its December 2024 all-time high of $0.00002368, according to CoinMarketCap.
The filing comes after a cautionary precedent set by Grayscale‘s Dogecoin ETF, which debuted in November but fell well short of volume expectations. ETF analyst Eric Balchunas had predicted the product would generate at least $12 million in volume on its first day, but it recorded only $1.4 million. That performance raises questions about investor appetite for memecoin-linked investment products.
Canary Capital’s filing also highlights concentration risks associated with PEPE ownership. According to Etherscan data, there are currently 513,392 holders of the token. The filing warns that as of January 2026, the ten largest PEPE wallet addresses collectively held approximately 41% of the total circulating supply, a level the firm describes as “highly concentrated.”
Broader industry commentary offers a mixed outlook for altcoin ETFs. Some analysts have suggested that future altcoin cycles may depend on the continued launch of ETFs further along the risk spectrum. However, Matt Hougan, chief investment officer at Bitwise, stated in March that traditional altcoin cycles are over, arguing that institutional investors are now focused on yield-bearing digital instruments or crypto assets that generate revenue.
Fabian Dori, chief investment officer at Sygnum Bank, told Cointelegraph in December that new ETF filings are expected to surge in 2026, driven by evolving US crypto regulations. He noted that passage of the potential Clarity Act could push filings well beyond Bitcoin and Ether products. However, the Act has not advanced as quickly as the industry had anticipated, largely due to ongoing disagreements over stablecoin yields. Canary Capital’s own filing acknowledges that US regulations governing PEPE and the Ethereum network “continue to evolve,” which could affect the token’s use and demand.
Originally reported by CoinTelegraph.
