SEC Does Something It Rarely Does: Issues Negative Opinions on ETF Applications for Two Altcoins

A groundbreaking attempt to launch cryptocurrency-based exchange-traded funds (ETFs) in the United States that offer staking rewards has faced regulatory uncertainty. Two new Ethereum and Solana-focused ETFs planned to be launched by REX Financial and Osprey Funds have received initial registration approval from the U.S. Securities and Exchange Commission (SEC), raising new questions about the funds’ legal status. The SEC said the funds in question may not meet the definition of an “investment company” under federal securities laws, meaning they fail to meet one of the basic legal requirements for being listed on an exchange. SEC officials said in a letter to the issuer of the ETF Opportunities Trust that the two ETFs may have been falsely registered as “investment companies” and that the statements they made may have been misleading. The funds aimed to allow investors to earn staking rewards on cryptocurrencies such as Ethereum and Solana. Related News: What to Expect in Bitcoin in June? Expert Analysts Share Their Predictions “We believe we can address the SEC’s concerns regarding the investment company definition and do not plan to float the funds until this issue is resolved,” REX Financial General Counsel Greg Collett said in a statement. The SEC declined to comment beyond the letter’s content. “Even if the SEC doesn’t allow this structure to be listed, we believe that simpler ETF attempts that include staking will eventually be successful. It’s just a matter of time. But the SEC doesn’t seem to like the way REX is moving these applications forward,” said James Seyffart, an ETF analyst at Bloomberg Intelligence. This is the SEC’s second overt crackdown on ETFs that invest in alternative asset classes in recent months. In March, the SEC publicly criticized the world’s first ETF investing in the private credit market, offered by State Street Corp. and Apollo Global Management, just hours after it began listing. REX announced yesterday that it had received “active registration” for the two ETFs in question and that the funds could now be traded on the exchange. REX founder Greg King stated that both funds were planned to be launched in mid-June. “Until these concerns are addressed, appropriate steps will be considered to ensure compliance with the federal securities laws,” the SEC said in its letter. *This is not investment advice. Continue Reading: SEC Does Something It Rarely Does: Issues Negative Opinions on ETF Applications for Two Altcoins

Source: BitcoinSistemi