Market reactions were initially positive, with HBAR's price rising by 9% on the announcement day, but caution persists due to ongoing regulatory uncertainties.

Analysts suggest that SEC approval of the HBAR ETF could significantly boost institutional investments and drive up HBAR's price.

Hedera (HBAR) is not classified as a security by the SEC, which may facilitate a faster approval process for its ETF.

Following the ETF filing, HBAR's price saw an increase from $0.209 to a high of $0.225, reflecting strong market interest, although it later settled at around $0.214.

This move reflects a growing trend in the cryptocurrency market, as spot crypto ETFs gain traction, making digital assets more accessible to institutional investors and pushing towards mainstream adoption.

In November 2024, Canary Capital submitted a proposal to list the Canary HBAR ETF, aiming for direct investment in HBAR, alongside plans for other ETFs targeting notable altcoins like Solana, Litecoin, and XRP.

The application adds to a wave of filings with the SEC from various exchanges and asset managers seeking to launch ETFs linked to alternative cryptocurrencies.

The filing notes that while Hedera is not primarily a payments system, it does require a cryptocurrency to operate and incentivize its network.

Hedera, which utilizes the Hashgraph consensus algorithm, is a decentralized public network known for its fast and secure global transactions, governed by a council of prominent companies.

Canary Capital has partnered with Coinbase Custody Trust Company and BitGo Trust Company to ensure the ETF's asset security and compliance with Nasdaq's listing standards.

The SEC must review and approve the ETF filings before trading can commence, and this process could take time as HBAR currently lacks a futures-based trading history on U.S. exchanges.

Recent shifts in the SEC's regulatory stance, including the launch of two crypto index ETFs in February 2025, indicate increasing pressure for more approvals, potentially transforming the market landscape.