🚨Urgent: The SEC questions the legality of Ethereum and Solana products related to staking as ETFs.
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On May 31, 2025, the U.S. Securities and Exchange Commission (SEC) expressed concerns about the proposed exchange-traded funds (ETFs) from REX Financial and Osprey Funds, which invest in Ethereum (ETH) and Solana (SOL) while offering returns from staking.
The agency pointed out that the legal structure used in these funds, which is a C-Corporation structure, is rarely used in ETF funds and may not comply with regulatory laws 6 c-11, known as the "ETF Rule."
Additionally, the agency expressed concern that the disclosures in the registration statements could be misleading to investors, particularly regarding how staking works and how the resulting rewards are distributed.
In response to these concerns, REX Financial's General Counsel, Greg Collett, stated that they believe they can address the agency's concerns and that they do not intend to launch the funds until these issues are resolved.
This development could affect the timeline for launching these funds and may prompt companies to adjust their structures or disclosures to meet the agency's requirements..
