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The U.S. Securities and Exchange Commission has extended its review of Canary Capital’s proposed Pudgy Penguins ETF by 60 days, pushing the decision deadline to March 11 and triggering a 6% price drop in PENGU, which is currently trading near $0.012.
At the time of writing, PENGU was trading near $0.012, up marginally over the past 24 hours. The token has rallied about 23% over the past week, but that recovery has yet to fully repair the damage from earlier declines.
On a 30-day basis, PENGU remains down roughly 4.4%, reflecting a market still searching for direction as uncertainty around the Pengu ETF decision persists.
Late on Jan. 7, the U.S. Securities and Exchange Commission extended its review of Canary Capital’s proposed Pudgy Penguins ETF by another 60 days, shifting the deadline to March 11. The filing, originally submitted in September 2025, has already faced multiple extensions, underscoring the SEC’s cautious stance toward novel crypto-linked investment products.
The delay has sharpened market focus on the Pengu ETF decision, which many traders view as a potential inflection point not only for PENGU but also for NFT-linked financial products more broadly.
Unlike traditional spot crypto ETFs, Canary’s proposal is structurally complex. The fund aims to list on the Cboe BZX Exchange and would hold a mix of Pudgy Penguins NFTs alongside PENGU tokens, which are issued on the Solana blockchain. That hybrid design raises thorny questions around valuation, custody, and compliance—issues that go beyond the scope of most digital asset ETF applications.
“ETFs that incorporate NFTs introduce an entirely new layer of regulatory scrutiny,” said James Seyffart, ETF analyst at Bloomberg Intelligence, in previous commentary on NFT-linked funds. “How assets are priced, safeguarded, and audited becomes far less straightforward.”
Markets responded swiftly to the latest delay. Following news of the extension, PENGU slid by roughly 6%, highlighting just how closely sentiment is tethered to the Pengu ETF decision. The pullback came despite strong brand visibility for Pudgy Penguins, including its widely publicized “Year of the Penguin” campaign and a full visual takeover of the Las Vegas Sphere.
Trading data shows that participation is cooling. Spot trading volume dipped slightly to around $209 million, while derivatives activity fell more sharply. According to CoinGlass, derivatives volume dropped 11% to $315 million, and open interest slid to $112 million. Those figures suggest traders are trimming exposure while awaiting clarity on the Pengu ETF decision.
From a charting perspective, PENGU is approaching a decisive moment. Price action is pressing into a descending trendline that stretches back to the November highs near the $0.038–$0.040 range. This trendline has consistently capped upside attempts, reinforcing its importance.
The current rebound has carried PENGU into the $0.0130–$0.0135 zone, an area that has repeatedly attracted selling pressure. This region also aligns with the 20-day moving average and sits near the midpoint of recent consolidation, making it a key near-term resistance band.
Momentum indicators have improved modestly. The relative strength index (RSI) is hovering around 58, signaling rising demand but stopping short of overbought territory. PENGU is also trading in the upper half of its Bollinger Bands, suggesting controlled volatility rather than a breakout-driven surge.
“A clean daily close above $0.0135 would be the first real signal that downside pressure is easing,” said one technical analyst at a digital asset trading firm. “Until then, rallies remain vulnerable, especially with the Pengu ETF decision still unresolved.”
If resistance holds, downside levels are well mapped. The $0.012 area has acted as a reliable support zone during recent pullbacks. A breakdown below that level could open the door to a move toward $0.0103, followed by the broader swing low near $0.0071, which marks the current cycle bottom.
These technical levels matter because regulatory uncertainty often amplifies price swings. As long as the Pengu ETF decision remains pending, traders are likely to react sharply to both headlines and chart signals.
The outcome of the Pengu ETF decision carries implications that extend beyond a single token. Approval could set a precedent for how NFTs are treated within regulated investment vehicles, potentially opening the door to similar hybrid products.
Another delay—or an outright rejection—would reinforce the regulatory hurdles facing NFT-based financial instruments in the U.S.
For now, the SEC has offered no public indication of how it views the proposal’s chances. The extension suggests regulators are still weighing the legal and operational risks, particularly around custody and valuation of NFTs held inside an ETF wrapper.
As March 11 approaches, the Pengu ETF decision is likely to remain the dominant narrative shaping PENGU’s price. Until regulators provide clarity, the token appears stuck between improving technical momentum and a macro cloud of uncertainty.
Whether PENGU can break free from its descending trendline—or slips back toward lower support—may ultimately depend less on charts and more on how the SEC resolves one of the most closely watched ETF reviews in the NFT space.
