🟢⚡According to Cointelegraph, the U.S. Securities and Exchange Commission (SEC) has expressed concerns regarding the registration amendment for ETFs proposed for Solana (SOL) and Ether (ETH) by REX Financial and Osprey Funds. The SEC's concern stems from the unique corporate structure of c-corp that these funds use, which is rarely used for ETFs and conflicts with Rule 6C-11, commonly referred to as the 'ETF Rule.' This regulation specifies the accepted institutional structures for ETFs. In a letter dated May 30, the SEC stated that it has ongoing questions regarding whether the proposed structure and operation of these funds will meet the definition of an 'Investment Company' under the Investment Company Act. The letter also highlighted that the disclosures in the registration statement regarding the status of the funds as investment companies may be misleading.
Despite this setback, there is optimism among analysts that an agreement will be reached between ETF issuers and the Securities and Exchange Commission. Eric Balchunas, an ETF analyst at Bloomberg, noted in a post dated May 31 that the legal team at REX is confident in resolving the issues. He also mentioned that issuers are eager to be the first to enter the market, pushing the limits to achieve this goal. Cryptocurrency investors and traders are closely monitoring the approval of altcoin ETFs and custody in the United States, as these investment tools are expected to bring new liquidity from traditional financial markets into the cryptocurrency sector.
The SEC's decision on altcoin and custody ETFs is still pending, despite recent guidance indicating that cryptocurrency custody does not violate securities laws and is not considered a securities transaction. James Seyfarth, an ETF analyst at Bloomberg, commented that these delays are expected and typical, noting that most of these filings have final deadlines in October. Seyfarth confirmed that it is uncommon for ETF applications to receive approval at such an early stage. Ongoing developments in the ETF space remain a focal point for stakeholders.
The interest in cryptocurrencies and financial markets.
