a regulated approach to investing in Binance’s crypto

VanEck, one of the most well-known asset managers in the ETF sector, has officially filed with the Securities and Exchange Commission (SEC) the S-1 form to register the first U.S. ETF based on the BNB token, the native cryptocurrency of the BNB Chain, originally launched by Binance. The new instrument will be called VanEck BNB ETF and will offer direct exposure to the price of BNB, without the use of derivatives, leverage, or active strategies.

The initiative represents a further step in the evolution of digital finance, introducing a regulated and easily accessible means to invest in an asset still absent in the landscape of crypto ETFs approved in the United States.

What is the VanEck BNB ETF

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The VanEck BNB ETF is an exchange-traded fund that aims to faithfully replicate the spot price of BNB, net of the fund’s operating expenses. The Trust will directly hold BNB tokens and will not use complex instruments such as swaps, futures, or options. The custody of the assets will be entrusted to a regulated custodian who will keep the private keys in both hot wallet and cold storage, applying advanced security measures, insurance, and asset segregation.

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The price of the fund will be calculated daily based on an index constructed and maintained by MarketVector Indexes GmbH, an affiliate of VanEck, which selects the five main BNB trading platforms based on a proprietary report that evaluates parameters such as regulatory compliance, security, data quality, and historical performance.

The fund will be tradable on the main US stock exchanges (name and ticker yet to be defined) and will be aimed at both retail and institutional investors.

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Mechanism of operation

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The ETF will operate according to an “in-kind” or “cash” structure through specialized operators called Authorized Participants (AP). These entities will be able to create or redeem ETF shares in blocks (basket) that represent a certain amount of BNB. The creation or redemption can occur in two ways:

• In-kind: the authorized participant delivers or receives BNB directly.
• Cash: the Trust uses cash to buy or sell BNB through selected Liquidity Provider.

The ETF shares will then be distributed to the public and traded on the secondary market. Prices on the market may vary compared to the net asset value (NAV) due to demand, supply, and market conditions.

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Staking Opportunities

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One of the distinctive elements of the VanEck BNB ETF is the possibility, in the future, to activate staking activities if the exchanges on which it will be listed obtain the necessary regulatory approval (Staking Regulatory Approval). In that case, the fund will be able to use a portion of the BNB tokens held to earn rewards in BNB through trusted staking providers, also affiliated with VanEck.

The potential staking rewards could be considered income for the fund and, consequently, affect returns and taxation. However, the fund does not intend to acquire or recognize Incidental Rights arising from fork or airdrop, which will therefore be automatically excluded from the determination of the NAV.

Why an ETF on BNB?

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BNB is one of the most capitalized and used digital assets in the world. Born as a utility token for the Binance platform, over time it has taken on more extensive roles within the BNB Chain, a blockchain network that supports smart contracts, DApps, peer-to-peer transactions, and staking functionalities. Today, the BNB Chain is structured on three levels:

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• BNB Smart Chain (Layer 1) for smart contracts and DeFi
  applications
• opBNB, Layer 2 for scalability
• BNB Greenfield, network for decentralized storage

BNB is used to pay fees, participate in network governance, be staked, or used as gas fee in transactions. The token has a maximum supply of 200 million units.

VanEck, already a promoter of ETFs on Bitcoin, Ethereum and other asset classes, intends to provide an investment vehicle that allows investors to gain exposure to BNB without having to manage wallets, private keys, platforms crypto or complex tax issues.

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Risks and Regulatory Considerations

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As highlighted in the information prospectus, investing in the VanEck BNB ETF involves significant risks. Among the main ones:

• Extreme volatility of the BNB price
• Absence of regulatory protections typical of funds registered under the Investment Company Act of 1940
• Custody and security risks related to the management of digital tokens
• Uncertain regulation on the fiscal front, particularly for staking operations and the use of BNB for the payment of expenses
• Possible ties with Binance, entity involved in proceedings with SEC and DOJ in 2023-2024

Furthermore, since it is a decentralized asset, the value of BNB heavily depends on the evolution and security of the BNB Chain, user trust, the quality of developers, and the ability to scale the network.

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Conclusion

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The VanEck BNB ETF represents a historic step towards the institutional adoption of BNB and, more generally, towards a maturation of the crypto market. If approved by the SEC, it will be the first regulated fund to provide direct exposure to the native token of the BNB Chain, expanding investment options and contributing to the legitimization of an asset now central in the blockchain ecosystem.

Investors interested will have to wait for the final approval from the SEC and the subsequent listing on the Stock Exchange, but the ETF is already positioning itself as one of the most innovative products in the landscape of digital assets in 2025.