Catenaa, Tuesday, June 17, 2025- The US Securities and Exchange Commission has raised doubts about a recent proposal from ETF issuers REX Shares and Osprey Funds to launch exchange-traded funds that would stake Ethereum and Solana.
The agency warned that the “staking ETF” plan may not meet the fundamental legal definition of an investment fund.
The SEC’s concerns were outlined in a letter sent late Friday to REX Shares and Osprey Funds.
Associate Director Brent J. Fields stated that the agency’s staff has “unresolved questions” about whether the proposed funds, as structured, would qualify as an “investment company” under the Investment Company Act.
The proposal involved creating C-corporation ETFs that would invest in Ethereum and Solana, with at least half of the assets being staked to generate additional yield. The SEC also revealed it had asked the issuers to delay the effectiveness of their registration statement, which technically went live on Friday.
Fields indicated that if these concerns remain unresolved, the SEC staff will consider “appropriate next steps to ensure compliance with the federal securities laws.”
The agency also requested that prior email correspondence from May 29 between the SEC and the issuers be made public for potential investors.
Greg Collett, general counsel at REX Financial, told Bloomberg that the firm believes it can satisfy the SEC’s questions regarding the investment company definition and does not intend to launch the funds until those issues are resolved.
While spot Ethereum ETFs have been trading since July of last year, a spot Solana ETF has not yet received approval.
