The five crypto exchange-traded funds (ETFs) from REX Shares and Osprey Funds are likely to debut only next week with a structure akin to their Solana SSK ETF, despite the Securities and Exchange Commission (SEC) approval.
The REX-Osprey ETFs employed a registered investment company (RIC) structure, which distinguishes them from both traditional spot crypto ETFs and the Solana ETF’s initial approach, as Bloomberg ETF analyst James Seyffart explained in a Sept. 11 post on X.
RIC Framework
While spot Bitcoin and Ethereum ETFs operate as pure spot products and the Solana ETF (SSK) initially launched as a C-corporation before converting structures, REX-Osprey chose the RIC framework to navigate regulatory requirements while maintaining operational flexibility.
This structure enables the funds to primarily hold spot crypto assets while retaining the ability to use derivatives and invest in other ETFs when market conditions require. The funds operate within established investment company regulations rather than corporate tax structures.
The RIC approach provides different operational requirements, tax treatment, and regulatory oversight compared to C-corporations. These differences affect how the funds distribute returns to investors while offering a middle path between pure spot exposure and complete structural innovation.
Bloomberg senior ETF analyst Eric Balchunas added information that suggests a debut next week, noting that the Dogecoin ETF (DOJE), which was expected to debut on Sept. 12, experienced another delay. He predicted that DOJE will start trading next week, potentially mid-week.
As a result, REX-Osprey funds tied to Bitcoin, XRP, TRUMP, and BONK are likely to follow suit, waiting another week to introduce a new structure to the US crypto ETF landscape.
Standard approvals potentially incoming
The REX-Osprey approvals arrive as the SEC develops a standardized listing framework for crypto ETFs that would eliminate individual rule-change requests for qualifying assets.
The Commission recently issued stay orders on both Bitwise’s $1.68 billion crypto index fund conversion and Grayscale’s Digital Large Cap Fund ETF transition, halting approvals just hours after initially granting them.
Seyffart suggested that the SEC deliberately stalled conversions to prevent ETFs from launching before establishing comprehensive digital asset listing standards.
The proposed framework would allow ETF sponsors to bypass the customary Form 19b-4 process when underlying tokens meet predetermined criteria, including market capitalization, on-exchange trading volume, and daily liquidity thresholds.
Sponsors would submit registration statements on Form S-1 and observe standard 75-day review periods before listing.
Amid this backdrop, the agency appears reluctant to approve products that could complicate future regulatory frameworks or create difficult-to-reverse precedents.
Additionally, he predicted in April that crypto ETFs could receive batch approvals in October when over 90 filings reach final deadlines. The filings include Solana, Litecoin, and XRP ETFs.
Given the proximity to the expected month for massive altcoin ETF approvals, it remains uncertain how REX-Osprey’s hybrid structure will perform.
Although the registered investment company approach provides immediate market access, it may have disadvantages regarding fees and tax structures compared to pure spot products.
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