Crypto ETFs Just Hit a Brick Wall — But Trump Might Blow It Wide Open
ETF issuers REX Financial and Osprey Funds are trying to push the crypto envelope and the SEC isn’t thrilled. Both firms recently proposed funds that would let investors earn yield by staking Ether and Solana tokens. Think of it like earning dividends, except from validating blockchain transactions. The SEC initially let the proposals through a key filing stage, but within hours, staff flagged a major problem: these funds might not legally qualify as investment companies. That’s because staking rewards fall into a regulatory gray zone and the SEC isn’t ready to redraw the lines just yet.
At the core is the 1946 Howey test, which says something is a security if investors expect profits from others’ efforts. Staking arguably…
