Ethereum and Solana Staking ETFs Poised for U.S. Market Entry Amid Regulatory Innovations
In a groundbreaking move for the cryptocurrency investment landscape, REX Shares and Osprey Funds have filed for Ethereum (ETH) and Solana (SOL) staking exchange-traded funds (ETFs) in the United States. These proposed ETFs aim to offer investors exposure to staking rewards, a feature previously inaccessible through traditional ETF structures.
The innovative approach involves structuring the ETFs as C-corporations under the Investment Company Act of 1940, commonly referred to as “40-Act” funds. This classification allows the funds to bypass the conventional and often lengthy SEC approval process known as the 19b-4 filing. Additionally, the ETFs plan to gain exposure to ETH and SOL through wholly owned subsidiaries based in the Cayman Islands, enabling them to participate in staking activities while adhering to U.S. regulatory standards .
Each fund intends to invest at least 80% of its assets in either Ethereum or Solana, with a minimum of 50% of those holdings actively staked to generate on-chain rewards. These rewards would be distributed to investors as dividend income, introducing a novel income-generating component to crypto ETFs .
The timing of these filings aligns with recent guidance from the U.S. Securities and Exchange Commission (SEC), which clarified that certain proof-of-stake blockchain protocol staking activities are not considered securities transactions under federal law. This clarification has opened the door for more innovative crypto investment products, such as the proposed staking ETFs .
While the SEC has raised concerns about whether these vehicles qualify as ETFs under federal securities law, the unique structure of the proposed funds may offer a pathway to approval . Analysts suggest that if approved, these ETFs could be listed on major U.S. exchanges in the coming weeks, marking a significant milestone in the integration of cryptocurrency staking into mainstream investment portfolios.
The introduction of staking ETFs represents a significant advancement in the cryptocurrency investment space, providing investors with regulated avenues to participate in staking rewards. As the regulatory environment
