TRUMP, BONK and DOGE proposed for ETF in new filing with the US SEC

A company has filed a prospectus to launch a set of new ETFs, this time tapping some of the newer meme tokens. The ETF proposal also includes the possibility of an ETF based on Official Trump (TRUMP). 

A new prospectus has been filed with the US Securities and Exchange Commission (SEC), listing a new selection of coins and tokens. The issuer included even the recently launched Official Trump (TRUMP), in addition to other meme tokens. 

The proposals, filed as Rex-Osprey, feature a selection of traditional assets BTC, ETH, and SOL. The filing expands the funds to also include the legacy meme coin, DOGE. Another ETF was proposed for BONK, one of the leading Solana memes, and lastly, an ETF for an asset only a few days old, TRUMP. The proposed TRUMP ETF will be launched through its own subsidiary registered as a Cayman Islands business entity, REX-OspreyTM TRUMP (Cayman).

A prospectus is only the very first step in the process, as the final SEC approval may take years. However, the move drew renewed attention as TRUMP suffered its first drawdown after the initial hype. The ETF filing comes on the first business day after the long weekend in the USA, extending the recent trend of new ETF proposals or secondary filings. 

Recently, ProShares filed for products based on spot and derivative XRP trading, while VanEck filed for an Onchain Economy ETF. 

The TRUMP ETF was proposed among older, more liquid assets, despite warnings that the TRUMP meme token was a sign of support and not an investment opportunity. However, TRUMP was the more successful asset compared to World Liberty Financial (WLFI) due to the immediate trading opportunities. 

With the recent ETF filing, TRUMP is the one crypto asset to speed-run the process from a decentralized launch to a Coinbase listing and a potential ETF. 

New filing aims to speed-run the ETF process

Not only was TRUMP selected just days after its launch, but the issuer chose an SEC procedure with a shorter time frame. The risky type of filing is made under the Investment Company Act of 1940, which could lead to a launch 75 days after filing. The extremely short period to launch caused some skepticism about the chances of the new fund and its potential investment value.

The filing itself depends on the SEC’s reaction to the new proposal. The ETF product will also not rely on the spot market, or hold a reserve of TRUMP tokens. Instead, the filing will include a mix of derivatives and assets held by the Cayman Islands entity. 

The proposed ETF on TRUMP will rely on derivatives, or making a prediction on the token’s spot value. The issuer will seek exposure to the price performance of TRUMP through derivative contracts. The ETF may also add investments into other ETFs, ending up with a product to mitigate risk. 

At a maximum, the final product may hold 25% of TRUMP tokens or exposure to the asset, with the remaining mix depending on US Treasuries, other types of government debt, money market funds, cash, and cash-like equivalents. The issuer warned there may be a limited market for TRUMP derivatives, as well as few counterparties, leading to a risky, illiquid market. Currently, Hyperliquid is one of the few exchanges to add a derivative market for TRUMP tokens. 

In comparison, the latest series of ETF filings on Solana, Litecoin, and others, have used the 19-4b form, which has a 240-day waiting period. The long approval process was what extended the time for the launch of the first Bitcoin and Ethereum ETF. 

TRUMP recovers after the initial sell-off

TRUMP was a surprisingly liquid token, gaining traction both on Meteora and Orca DEX and on centralized markets. Initially, the token dipped by 50%, down to a low of $31. The correction was mostly due to profit-taking, especially by early whale buyers. 

Later, TRUMP recovered to $42.25, with trading volumes over $13B. The token tracked the overall performance of the crypto market, where most assets bounced from their lows. Existing ETFs continued to accumulate tokens, with Bitcoin funds adding another 4,023 BTC, signaling the continuing greed-based accumulation.

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