Rex Shares is getting ready to convey a brand new wave of unconventional exchange-traded funds (ETFs) to US markets.
On Sept. 3, the asset supervisor filed a prospectus with the Securities and Change Fee (SEC) for the REX-Osprey Dogecoin ETF, which can commerce underneath the ticker DOJE.
The submitting additionally references related merchandise linked to XRP, Solana (SOL), Ethereum (ETH), Bitcoin (BTC), BONK, and TRUMP tokens.
Bloomberg ETF analyst Eric Balchunas famous that Rex’s efficient submitting indicators a possible launch inside days for these merchandise.
He wrote:
“Seems like Rex goes to launch a Doge ETF through the 40 Act a la SSK subsequent week.”
Balchunas identified that whereas Dogecoin will be the first to debut, different merchandise tied to Trump, XRP, and Bonk may quickly comply with.
Why REX ETF merchandise launch early
Not like conventional ETFs that require prolonged SEC approval via the 19b-4 course of, Rex Shares has chosen a unique regulatory path.
The proposed merchandise are registered underneath the Funding Firm Act of 1940 and structured as C-corporations. This mannequin permits the agency to sidestep the usual trade rule approval course of whereas gaining publicity to digital property via a Cayman Islands subsidiary.
The Crypto Investor Blueprint: A 5-Day Course On Bagholding, Insider Entrance-Runs, and Lacking Alpha
In the meantime, selecting a C-corporation construction carries essential tax implications for traders.
VanEck defined that the majority ETFs elect to be handled as regulated funding firms (RICs), which permits them to keep away from fund-level taxation by distributing revenue and capital good points on to shareholders. Nevertheless, RICs should meet strict necessities for revenue sources, asset diversification, and distributions.
In distinction, C-corporations face taxation on the fund stage, and any subsequent investor payouts are additionally taxable.
Traders have typically criticized this association as “double taxation.” Because of this, ETFs are inclined to keep away from this setup.
Nevertheless, REX Shares’ choice means that pace to market and adaptability outweighed the potential tax drawbacks these merchandise would possibly entice.
Notably, the asset supervisor had launched the first-ever staked crypto ETF within the US via this construction earlier this 12 months.
