SEC Releases Statement on Crypto Asset Exchange-Traded Products

The staff in the SEC’s Division of Corporation Finance has released a statement to clarify its views on applying the “federal securities laws to offerings and registrations of securities by issuers of crypto asset exchange-traded products.” Specifically, the statement addresses the staff’s “observations regarding disclosure practices in [its] reviews of crypto asset ETP filings [as well as its] views about certain specific questions that market participants have presented to the staff.” The statement focuses on disclosures that issuers are required to provide “on the outside front cover page of the prospectus related to the offering.” Topics addressed in the statement include disclosure requirements related to the prospectus summary; risk factors; description of a business; the trust’s service providers, custody of the trust’s assets, and fees and expenses; the description of the issuer’s securities; the plan of distribution for the securities; and information about the issuer’s directors, executive officers, and significant employees.