Canary Capital has filed an application with the US Securities and Exchange Commission to launch a spot exchange-traded fund (ETF) tied to the price of Pepe. The proposed CANARY PEPE ETF would directly hold the token, offering investors exposure to the memecoin through traditional financial markets.

According to the filing, the ETF would store its PEPE holdings with a custodian and may allocate up to 5% of its assets in Ether to cover transaction fees on the Ethereum network. This structure reflects how blockchain-based assets require operational reserves to manage onchain costs.

The move highlights Canary Capital’s growing focus on expanding its crypto ETF lineup beyond major assets. The firm already offers or has proposed ETFs tied to tokens such as XRP, Solana, Hedera and Sei, signaling a broader push into altcoin-based investment products.

PEPE’s Market Position and Risks

Despite the ETF filing, PEPE remains a highly volatile asset. The token surged in popularity during 2024, driven largely by social media momentum and retail investor interest. However, it is still trading significantly below its all-time high reached in December 2024.

While PEPE ranks among the more prominent memecoins, it remains much smaller than Dogecoin, the sector’s largest token by market capitalization. Its investor base is also relatively concentrated, with a small number of wallets holding a substantial portion of the total supply.

Canary Capital acknowledged these risks in its filing, noting that concentrated ownership could amplify price volatility and impact liquidity. Such dynamics may present challenges for an ETF structure, particularly during periods of market stress or rapid price swings.

Growing Trend of Altcoin ETF Filings

The PEPE ETF proposal is part of a broader wave of filings aimed at expanding crypto investment products beyond Bitcoin and Ethereum. Industry analysts have suggested that future market cycles could depend on the availability of ETFs covering a wider range of digital assets.

However, some experts argue that institutional demand may not extend equally to all tokens. According to market observers, investors are increasingly focused on assets that generate yield or have clear revenue models, rather than purely speculative tokens. This could limit the appeal of memecoin-based ETFs despite growing curiosity in the space.

Still, the number of ETF applications is expected to rise as regulatory clarity improves. Market participants anticipate that evolving legislation could open the door for more diverse crypto investment vehicles in the United States.

Regulatory Uncertainty Remains

The filing also underscores ongoing regulatory uncertainty in the US. Rules governing cryptocurrencies, stablecoins, and blockchain infrastructure continue to evolve, which may affect both the approval process and long-term viability of such products.

Delays in broader crypto legislation, including debates around stablecoin regulation, have slowed the pace of approvals for new financial products. This creates an unpredictable environment for issuers like Canary Capital seeking to innovate in the ETF market.

Even so, the firm’s willingness to pursue a memecoin ETF reflects growing confidence that investor appetite exists for more experimental and high-risk digital assets within regulated frameworks.

If approved, the CANARY PEPE ETF would mark a notable milestone, bringing one of the internet’s most recognizable memecoins into the realm of traditional finance and potentially reshaping how speculative crypto assets are packaged for institutional and retail investors alike.

DeFi & FinTech, Markets & Trading, News

Yuga Labs, the creator of the Bored Ape Yacht Club (BAYC), has reached a settlement in its long-running lawsuit against artists Ryder Ripps and Jeremy Cahen, who were accused of producing and selling copycat NFTs. The agreement brings an end to a legal battle that began in 2022 and has since become one of the most closely watched intellectual property cases in the NFT space.

Court filings in the U.S. District Court for the Central District of California confirmed that both parties agreed to resolve the dispute, avoiding a jury trial that had been scheduled following a series of appeals.

Terms of the Settlement Agreement

As part of the settlement, Ripps and Cahen are permanently prohibited from using Yuga Labs’ trademarks, imagery, or branding associated with BAYC. They are also required to transfer control of all related assets from their RR/BAYC project to Yuga Labs within 10 days.

These assets include smart contracts, domain names, and any remaining NFTs tied to the disputed collection. The court further ordered that the artists must not attempt to transfer, conceal, or dispose of any related assets in a way that would interfere with compliance.

The settlement effectively consolidates control of the disputed NFTs under Yuga Labs, reinforcing the company’s claims over its intellectual property and brand identity in the digital asset space.

Background of the Legal Battle

The case dates back to June 2022, when Yuga Labs filed a lawsuit alleging that Ripps and Cahen had copied the distinctive cartoon ape images from the Bored Ape Yacht Club collection and sold them as part of a separate NFT project. Yuga argued that the artists misled buyers and generated millions in revenue by capitalizing on confusion between the two collections.

In response, the artists claimed their RR/BAYC NFTs were intended as satire and artistic commentary, arguing that their work was protected under free speech laws. This defense became a central issue in the case, raising broader questions about parody and intellectual property rights in the context of NFTs.

In April 2023, a court ruled in favor of Yuga Labs, finding that the artists had violated copyright laws and awarding damages of $1.37 million, along with additional penalties. The total financial liability later increased to approximately $9 million after further legal developments, including the dismissal of counterclaims.

Appeals and Final Resolution

Despite the initial ruling, the legal battle continued. In 2025, an appeals court vacated the earlier judgment and called for a jury trial to determine whether trademark infringement had occurred. This decision prolonged the dispute and introduced further uncertainty over how courts would interpret NFT-related intellectual property claims.

The newly reached settlement avoids that trial and brings closure to the case without a final jury verdict. While specific financial terms of the settlement were not disclosed, the agreement’s conditions strongly favor Yuga Labs in terms of asset control and brand protection.

DeFi & FinTech, Markets & Trading, News, NFTs & Collectibles

South Korea is preparing to take a significant step in regulating digital assets by incorporating tokenized real-world assets (RWAs) and stablecoins into its existing financial legal framework. The initiative is being led by the ruling Democratic Party of Korea as part of its proposed Digital Asset Basic Act, according to local reports.

The move reflects a broader effort to bring clarity and structure to the rapidly evolving crypto sector by aligning it with established financial regulations rather than creating entirely new systems. The legislation marks South Korea’s second major attempt to formalize digital asset oversight after earlier delays pushed back initial timelines.

Framework for Tokenized Real-World Assets

Under the proposal, issuers of tokenized RWAs would be required to deposit the underlying assets into managed trusts in accordance with existing capital markets regulations. This approach aims to ensure that digital tokens representing real-world assets are fully backed and transparently managed.

By leveraging existing legal structures, regulators intend to reduce risks associated with tokenization, such as mismanagement or insufficient collateralization. Additional details on implementation are expected to be defined through a presidential decree, allowing flexibility in adapting to market developments.

This framework signals that South Korea sees tokenized assets not merely as speculative instruments but as extensions of traditional financial products that must meet similar compliance standards.

Stablecoins Classified as Payment Instruments

The proposal also introduces clear guidelines for stablecoins by classifying them as a “means of payment” under foreign exchange regulations. This classification would place stablecoin issuers under the supervision of financial authorities without requiring entirely new licensing regimes.

Smaller stablecoin transactions used for goods and services would be exempt from foreign exchange reporting requirements, a move that could encourage everyday usage while maintaining oversight on larger transfers. This dual approach balances innovation with regulatory control, potentially supporting wider adoption in retail payments and commerce.

Proposed Ban on Stablecoin Yield

A notable aspect of the proposal is a planned ban on yield generated from idle stablecoin balances. This comes amid ongoing global debates, particularly in the United States, about whether stablecoin issuers should be allowed to offer interest-like returns.

South Korea’s stance suggests a cautious approach, aiming to prevent stablecoins from functioning like unregulated banking products. By restricting yield, regulators may seek to reduce systemic risks and avoid blurring the line between payment instruments and investment vehicles.

Toward Interoperability and Transparency

The proposal also tasks the Financial Services Commission with developing technical standards to ensure interoperability between stablecoin systems. Additionally, it aims to establish a unified disclosure framework for digital assets, improving transparency for investors and users.

These measures indicate a long-term vision of integrating digital assets into the broader financial ecosystem while maintaining high standards of consumer protection and operational stability.

If implemented, South Korea’s regulatory approach could serve as a model for other jurisdictions seeking to balance innovation with oversight, particularly as tokenized finance and stablecoins continue to gain global traction.

DeFi & FinTech, News, Regulation & Policy