On May 30, 2025, the US Securities and Exchange Commission (SEC) expressed doubts about the bid by REX Shares and Osprey Funds to launch staking – based Ethereum and Solana exchange – traded funds (ETFs). Here are the details:
The SEC’s Concerns: In a letter, the SEC stated that it had “unresolved questions” regarding whether the funds, if structured and operated as proposed, would meet the definition of an “investment company” under the Investment Company Act. The SEC also pointed out that the current disclosures might mislead investors, and the C – corp structure and staking mechanism of the proposed ETFs conflicted with Rule 6c – 11, which governs the legal framework for ETF structures.
Request for Delay: The SEC asked the issuers to delay the effectiveness of the registration statement, which had gone into effect on Friday. The SEC also requested that the issuers make public an email correspondence from May 29 to ensure transparency for potential investors.
Response from the Issuers: Greg Collett, the general counsel at REX Financial, said that they believed they could satisfy the SEC on the investment company question and did not intend to launch the funds until they had done so.
The SEC’s move signals growing regulatory caution around staking – related products and complex ETF structures. It remains to be seen whether REX Shares and Osprey Funds can address the SEC’s concerns and successfully launch their staking Ethereum and Solana ETFs.
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