❌❌❌ Rumor Refutation!!!
Regarding the rumor that @REXShares SOL staking ETF has been approved, let me explain: What is 40Act?
40Act refers to the Investment Company Act of 1940, which, along with the Securities Act of 1933 (33Act) through which conventional spot ETFs are approved, is one of the core laws regulating funds in the United States.
📌 40Act applies to actively managed funds and staking yield ETFs, while REX's SOL ETF cleverly bypasses the 19b-4 process (SEC default compliance) by registering as a C corporation (C-Corp) through 40Act—currently, most ETFs that have not been approved are stuck at this 19b-4 step.
So since issuing ETFs through 40Act is so convenient, why are companies like BlackRock and Grayscale still waiting foolishly for the 19b-4 process under 33Act? Are they really that foolish❓❓❓
In simple terms, the operation logic of 40Act is basically this:
Investors are purchasing shares of the ETF issuing company (the registered C-Corp);
The company directly holds SOL tokens and conducts on-chain staking operations;
The earnings are distributed to investors through company dividends.
⚠️ This presents two core issues:
1: The C-Corp structure leads to double taxation: corporate tax is levied at the company level, and then individual income tax is levied again on shareholder dividends; whereas ETFs registered under 33Act are only subject to individual income tax once.
2: Does the C-Corp truly meet the definition of an “investment company”? According to 40Act, a fund must meet the conditions of “primarily investing in securities” or “having over 40% of its assets in securities.” If SOL is not a security, then the foundation of REX's registered C-Corp falls apart.
So here comes the core question:
Is SOL a security? Is SOL a security? Is SOL a security????
