[DigitalToday reporter Jinju Hong (홍진주)] Asset manager Canary Capital has applied to the U.S. Securities and Exchange Commission for approval of an exchange-traded fund that tracks the spot price of meme coin Pepe (PEPE).

Blockchain media outlet The Block reported on April 8 local time that Canary Capital submitted an S-1 filing to the SEC that day and is seeking to list a PEPE spot ETF.

The filing is seen as a test of whether the spot ETF market, which has focused on major cryptocurrencies such as bitcoin (BTC) and ethereum (ETH), could expand to meme coins.

Canary Capital has already pursued meme coin-related ETFs. Last year it applied to list a fund tracking the price of another meme coin, MOG, and it was also the first to apply for a Pengu ETF. The PEPE ETF filing follows that trend.

In the filing, Canary Capital said PEPE launched in April 2023 and that its total supply is more than 420 trillion tokens. It also stated the meme coin has no separate utility. The firm set out the nature of a meme coin for regulators while arguing it can still be included within an ETF structure.

Markets are focused on how far spot ETFs could expand. After bitcoin and ethereum ETFs established themselves as channels for institutional money inflows, asset managers have been moving to offer a wider range of cryptocurrencies in ETF form. Against that backdrop, it stands out that a volatile meme coin like PEPE, without clear real-world functionality, has come up for ETF review.

On the same day, Morgan Stanley launched a spot bitcoin ETF that would compete with BlackRock's flagship bitcoin fund. As competition in the spot ETF market intensifies, the filing is significant in that it shows a trend of gradually widening the range of assets in new applications.