REX Financial and Osprey Funds Clear SEC Hurdle for Staked ETH and SOL ETFs

ETF provider REX Financial and asset management firm Osprey Funds are poised to launch the first staked Ethereum (ETH) and Solana (SOL) ETFs in the US, following a significant development in their regulatory process. The SEC, in a June 27 statement, indicated that it had “no further comments” on the firms’ filings, a move that suggests the regulatory body has addressed all concerns regarding the proposed ETFs.

This update came in response to a request submitted by REX and Osprey to the SEC, seeking confirmation that all staff comments on their staked Ethereum and Solana ETFs had been resolved. The firms filed for staked SOL and ETH ETFs in late May, proposing ETF structures that would allow the funds to hold and stake the two prominent crypto assets and distribute stake rewards to shareholders.

However, the SEC initially raised concerns that REX and Osprey’s proposed funds may not qualify as ETFs under existing rules due to their unique C-corporation business structure. This structure conflicts with the ETF rule, which defines acceptable corporate forms for ETFs. Despite these regulatory hurdles, industry professionals remained hopeful for a resolution, anticipating that the funds could bring new liquidity into the crypto market.

According to an analyst, the SEC's statement that it has no further comments suggests that the firms are now clear to launch their staked ETH and SOL ETFs. REX and Osprey have also indicated their readiness from the product side, with a newly released “Coming Soon” campaign prominently featuring the upcoming staked ETH and SOL ETFs on their website. Although no official confirmation has been issued regarding approval or launch dates, the campaign signals the firms' confidence in the imminent launch.

The SEC's recent actions suggest a growing openness to incorporating staking into ETF structures. The regulatory body has signaled potential approval for Solana ETFs later this year, following a recent request to revise language around in-kind redemptions and staking practices. This development indicates a shift in the SEC's stance on crypto ETFs, potentially paving the way for more innovative financial products in the crypto space.