Memecoin ETFS and other crypto messages: What investors should know

The more speculative, casino-like corner of the stock market dealer fund market could be overcrowded.

Rexshares and his partner Osprey Funds have asked the SEC to start ETFs that pursue the values ​​of different cryptocurrencies.

Rexshares and Osprey plan -Tfs that are bound to three popular cryptocurrencies -Solana, XRP and Litecoin -and three “Memecoins” or cryptocurrencies that have a piggyback to meme from popular culture, including Doge, Trump and Bonk -coins, according to regulatory Submissions.

If I have lost them with references to Memecoins and Doge, they feel better. However, there is a lot of noise about these potential ETFs. Last week, the KRYPTO -ETF provider registered bites for its own Dotecoin Trust, which improves the prospects that a Dotecoin ETF becomes a reality. On Monday Tuttle Capital Management submitted the first cautious Memecoin ETFs, and it won’t stop here.

Let’s start with an important context for the three Memecoins:

• Doge is an old internet Mem that consists of a picture of a Shiba -inu dog with some random words that are crossed on it and have no crypto. Dogecoin became a joke and satirized cryptocurrencies. But the joke became serious: these coins are now worth around 50 billion US dollars together.
• President Trump’s Memecoin started too much fanfare three days before his office and exploded at the announcement of $ 15 billion. From Monday, 65% of his heights had fallen. The Trump Coin website contains a disclaimer that says that it is “not intended or the topic” of an investment or security. However, a Trump -Münz -Tf was submitted within days of its foundation.
• Bonkcoin plays from Doge Meme by also showing a Shiba Inu dog. It was launched in 2022 and set up a supporter by distributing trillions from coins to the Solana community free of charge. Its popularity at Tiktok was a driving force for growth in value at almost 3 billion US dollars.

The combined market value of these three cryptocurrencies is around 60 billion US dollars – equivalent to TGT or General Motors GM – but they have no underlying business or intrinsic value. Bitcoin ETFs have already expanded the definition of the capital markets, but Memecoins stretch the definition of investments to the snap point. Memoins may be the hat of this generation, which are intended for a figurative box in the keepers’ attics.

Bitcoin ETFs had a successful start because they gave institutions and consultants who wanted Bitcoin, but could not have direct access to cryptocurrency. I do not expect institutions or consultants to be very interested in memo cinema.

Solana, XRP and Litecoin -Tfs

In view of Trump’s pro-crypto and deregulation campaign, several issuers promised ETFs that would take other popular cryptocurrencies such as Solana, XRP and Litecoin shortly after it was taken. Trump’s appointment of the crypto -friendly Mark Uyeda as reigning chairman of the SEC was an important contribution to these submissions. Issuers expect the SEC under Uyeda to take a softer attitude towards crypto -related ETFs and increase its probability of consent. However, this does not mean that new cryptocurrency ETFs will be approved in a short time.

Under the former chairman Gary Gensler, the SEC hesitated to approve all Spot crypto. They decided to enable futures-based Bitcoin ETFs because the Chicago Mercantile Exchange ran a significant and, above all, regulated Bitcoin futures market. In the end, the courts decided that a futures -etf and a spot -etf had roughly the same risk, so that the Sec was forced to approve a Spot -Bitcoin ETF. Spot Ethereum ETFs followed the same pattern.

This is important because the approval of the SEC to the Futures ETFs led to the Spot -Tfs and these futures etts are based on existing regulated CME FUTURES markets. The SEC has only a few ways to monitor the underlying trade in cryptocurrencies, which makes it almost impossible to prevent the manipulation of the ETF via crypto exchanges. Instead, the SEC was able to rely on the regulation of the futures market by the Commodity Futures Trading Commission.

Today there are no futures markets for Solana, XRP or Litecoin. The SEC cannot approve a Futures ETF without a futures market and do not rely on a regulated futures market for police officers. Without this, I have difficulty seeing how a new acting chair of the SEC could improve this precedent and approve new spot crypto.

Even without consent, new crypto -ETFs are faced with a tough fight. Spot Ethereum -Tfs recorded significantly less investor interest than Spot -Bitcoin -ETFs, and I would expect a similar decline in interest with every new series of crypto.

Regulatory clarity for crypto

Last summer I sat down with a group of consultants who tried to understand what I should do out of Spot -Bitcoin. They all wanted to do it properly to their clients and the law, but they didn’t know how. There was little to no guide for what was allowed, and at the time the SEC sued several crypto actors, including the Custodian and surveillance partner of several Bitcoin ETFs. It was unclear whether the recommendation of a Bitcoin ETF would expire in the run -up to the regulations. The only advice I was able to give in compliance with crypto was: “I don’t know.”

On January 23, President Trump granted an executive regulation to “strengthen the American leadership in digital financial technology”. One of the measures of the order was that the SEC and other agencies grant the urgently needed clarity on crypto. The schedules for the order are short, but the result should be clearer instructions on how consultants and institutions can comply with regulations while investing in crypto.