Overview

• SEC staff warned in a May 30 letter that REX Financial’s and Osprey Funds’ proposed Ethereum and Solana staking ETFs may not meet the legal definition of investment companies needed for listing
• The commission flagged that the funds’ registration statements could mislead investors about their status under federal securities rules
• REX Financial received effective registration for its staking ETFs but will postpone their launch until the SEC’s concerns are fully addressed
• Issuers aim to resolve the legal issues and start trading by mid-June if they satisfy the SEC’s questions
• Commissioner Caroline Crenshaw criticized the agency’s piecemeal approach as regulators navigate conflicting definitions of crypto assets