SEC focuses on encrypted ETFs with occupancy

The Securities and Exchange Commission (SEC) is concerned that crypto exchange-traded trade funds may not qualify for ETFs after all.

On Friday, the institution sent a letter to the ETF Opportunity Trust Trust, Rex Finance and Osprey Fund's Ethereum and Solana Fund, and provided exposure to deposits: Rex Sugli Ett and Rex-osstrey sol etf.

Staking allows crypto investors to receive rewards on tokens they own.

"If the fund (if structured and operated as recommended) under the Investment Companies Act, it will continue to have unresolved issues," the SEC letter said.

By law, funds must meet this definition in order to be eligible to trade on the stock market.

The financial regulator added, “concern that funds may be inappropriate in the registration statement on Form N-1A and that disclosures of the disclosure of funds’ status as an investment company in the registration statement may be misleading.”

Rex Financial and Osprey Funds declined to comment on ETF.com. But, Bloomberg reported that Rex Financial's general counsel Greg Collett said: "We think we can meet the SEC on investment companies and we don't intend to roll out funds until we do so."

The funds were originally the "first fixed Ether and Solana ETF ever" and the "first Solana" ETF ever, according to Eric Balchunas, senior ETF analyst at Bloomberg.

The SEC's delay comes after the release of guidance on Thursday, noting that Sticking participants do not need to register their transactions with the institution.

Commissioner Caroline Crenshaw issued a statement on Saturday criticizing the SEC's "chaotic" over the security of crypto assets.

"In the name of this clarity, we have seen employee statements after employee statements that declare various crypto assets are not securities. However, now, we have no objection to the effectiveness of new exchange-traded funds that claim to own certain crypto assets (ETH and SOL) and are actually securities that are securities. In fact, is this ETH and SEL securities?" Crenshaw wrote. “In terms of registration requirements, these crypto assets are said to be not securities, and when registrants see an opportunity to sell new products, is securities convenient?”