On March 20, Canary Capital filed for a PENGU ETF, but instead of rallying, the token’s price fell 10% to $0.0062. Critics pointed to weak retail demand, sparking a bearish sentiment.
Trading activity surged after the ETF news, with daily volumes climbing 45% to over $135 million. However, the price volatility highlighted uncertainty around the ETF’s impact.
Pudgy Penguins (PENGU) ETF Development
Canary Capital’s filing proposed an exchange-traded fund tracking PENGU’s price alongside Pudgy Penguins NFTs. This marks the first crypto ETF to include NFT exposure.
The trust will hold spot PENGU and Pudgy Penguins NFTs, while also using Solana (SOL) and Ethereum (ETH) as needed for transactions. This structure aims to streamline fund operations and asset management.
Despite Pudgy Penguins’ popularity in the NFT space, the market reaction was negative, driving PENGU’s price down.
Why Did PENGU’s Price Drop?
The ETF filing triggered mixed reactions. While trading activity spiked, the price drop suggests skepticism. Analysts believe this muted response is due to PENGU’s association with NFTs and meme coins, which carry higher risks.
Critics argue that retail demand for PENGU and Pudgy Penguins NFTs is minimal. This skepticism added further selling pressure on the token.
PENGU vs. Other Meme Coin ETFs
PENGU isn’t the first meme coin with an ETF filing. Asset managers like Grayscale and Bitwise have also sought approval for a Dogecoin ETF. However, meme coin ETFs remain a niche market with uncertain investor interest.
Since its launch, PENGU has been listed on platforms like Robinhood. However, it has struggled to sustain momentum and is currently down over 90% from its all-time high in December.
