Canary Capital Proposes Staking at Least 90% of SEI ETF Assets

Key Facts

Canary Capital filed Pre-Effective Amendment No. 2 to the proposed Canary Staked SEI ETF's Form S-1 on September 15, 2026. The product would seek to track the price of SEI after expenses, with a secondary objective of earning additional SEI through proof-of-stake validation, and its proposed shares would trade on Cboe BZX.

Under normal circumstances, the sponsor expects to stake at least 90% of the trust's SEI while retaining an amount it determines is needed for foreseeable redemptions and expenses. BitGo would custody all SEI, while U.S. Bank would serve as cash custodian, so BitGo is the sole custodian of the token rather than of every trust asset.

The mechanism delegates SEI to validators through service providers, with the trust receiving part of the network rewards and accrued rewards entering its net asset value. Staking fees and fund expenses reduce that benefit; if rewards do not cover those costs, the amount of SEI represented by each share could decline over time even if the token's price does not.

The filing is not an approval or fund launch: the prospectus remains preliminary, the registration statement is not effective, and the ticker and sponsor fee remain blank. Staking also creates liquidity risk because undelegating SEI takes 21 days, requiring the sponsor to maintain enough liquidity to process redemptions while tokens are locked.