"In aggressive allocations, up to 5%…Crypto ETFs to gather pace in five years" [Midas’ Touch]

In the United States, a wide range of spot exchange-traded funds (ETFs) for digital assets—following Bitcoin—such as Ethereum, Ripple, and Solana are already trading actively. Looking solely at the spot Bitcoin ETF market, its history is only a little over two years, but it has continued to grow steadily, with daily trading volumes reaching billions of dollars.

Attention is now shifting to altcoin ETFs. With tokenization and stablecoins as key themes, forecasts are also gaining traction that the digital-asset ETF market will broaden its reach further. Expectations are rising that the tokenization trend—moving real-world and traditional assets onto blockchains—and stablecoins establishing themselves as payment and remittance infrastructure could become another driver of ETF market growth.

Korea’s situation is still different. Due to institutional constraints, digital-asset ETFs cannot be traded directly in the domestic market. However, if relevant provisions are included in the Digital Assets Act now under discussion led by the National Assembly and the government, the possibility could open for digital-asset ETFs to be permitted in Korea as well. In this process, there are no shortage of issues and variables to resolve, including investor-protection safeguards, exchange and custody structures, and the competitive landscape with overseas markets.

Steven McClurg, CEO of Canary Capital, took part in the initial listing process for the first Bitcoin ETF and is now running XRP and Solana ETFs, among others, through Canary Capital, a digital-asset specialist asset manager. In <Midas’ Touch>, airing on the 20th, we take an in-depth look with CEO Steven McClurg at shifts in the global crypto ETF market and investment strategies going forward.

Q. About Canary Capital

Steven McClurg, CEO of Canary Capital: "The company is Canary Capital. It was founded just 18 months ago. Most of the team comes from Valkyrie, which launched the first Bitcoin mining ETF in the United States, the first Bitcoin futures ETF traded on Nasdaq, and one of several early spot ETFs that competed with firms like BlackRock. We sold Valkyrie and decided to restart everything at Canary. So I brought many team members from GoldenTree Asset Management and Valkyrie, where I previously worked, and decided to focus on altcoin ETFs. We launched the first XRP ETF in the United States, the first HBAR ETF, and the first Litecoin ETF."

Q. Outlook for digital-asset ETFs

"The ability to put cryptocurrencies into ETFs has been a game changer for institutions and financial advisers. Before that, it was largely limited to certain hedge funds or retail investment products. But now that ETFs exist, you can see large pools of capital investing. Large sovereign wealth funds, insurers, pension funds, even endowment funds are investing in digital assets through ETFs. Bitcoin ETFs have existed for a few years now, and because altcoins like XRP and HBAR have emerged as well, we’re seeing many institutions begin buying—and this process is still at a very early stage. So I think five years from now, we’ll be looking at a very large global market for digital-asset ETFs."

Q. Bitcoin ETFs vs. altcoin ETFs

"At the outset, I think there will be more pent-up demand for Bitcoin ETFs. But over time, I think the market will start to look at utility and functionality. On Wall Street right now, the focus is, first, tokenization and, second, stablecoins. The focus is on the utility of all types of financial transactions. So I believe the focus will move away from Bitcoin toward platforms like XRP, Solana, and Sui, and toward HBAR for corporate-related transactions. Lastly, we’re also paying attention to privacy. Many privacy tokens are coming to the fore. Bitcoin has no privacy option, but Litecoin, which has a codebase very similar to Bitcoin’s, implemented privacy features to make wallets private and transactions private."

Q. Areas where you want to increase exposure

"The firm started as a hedge fund, and when we launched our altcoin ETFs, that business quickly overtook the hedge-fund business. So those ETFs are now our main business. We’re doing more research on tokenization and stablecoins, which is something we’ve also done in the past. We now see the market as ready for it. Three years from now it could be an ETF, but tokenization may instead move to the forefront."

Q. Direction for institutions on STOs and tokenization

"Over the past year, there’s been a really big shift as large institutions began focusing on tokenization. Everywhere—BlackRock, Fidelity and others—is concentrating on this area. It’s also the area I started in on blockchain back in 2016. It’s been interesting to watch everyone else catch up. Previously there wasn’t a big market in it, though there were many people working on it. But now they see a market there, and I think it will take off in 2026."

Q. Regulatory risks for crypto ETFs

"In the United States, there were many regulatory risks related to cryptocurrency ETFs, and under President Trump, people with pro-digital-asset leanings were appointed to lead the SEC, the CFTC, and the Treasury. As a result, they adopted policies that make it possible to create digital-asset ETFs with far less risk. The U.S. is in the process of drafting market-structure legislation that will define the domestic digital-asset market much more specifically in order to further remove risk. And I think those bills and policies will probably carry over to other countries and be adopted in a way that creates a much better ecosystem for digital assets."

Q. Korea’s growth potential for crypto ETFs

"I think Korea has enormous potential. Even considering that Korea is a smaller market than the United States, there is a lot of trading between the U.S. dollar and the Korean won. Of course, I know it’s not only Americans—people in other countries also use dollars to trade digital assets. What that means is there could be more people trading digital assets in Korea than in the United States. So if digital-asset ETFs are launched in Korea, I think it could become one of the largest markets in the world."

Q. Drivers of crypto ETF growth

"Individuals will be the first to come in and buy ETFs. Because people feel it’s safer to have it in their brokerage accounts than to go through exchanges, we’ve actually seen the shift from directly owning spot assets via exchanges to moving into ETFs. The next stage is financial advisers. In the United States, financial advisers are allocating about 1–2% of client portfolios to digital assets. Some advisers, in aggressive allocations, are putting in as much as 5%. Finally, sovereign wealth funds and pension funds are showing strong interest. Over time, the money will grow, and I think more institutional investors will begin using ETFs as an investment vehicle."

Min-jae Lee, tobemj@wowtv.co.kr