The U.S. Securities and Exchange Commission (SEC) has blocked applications for leveraged exchange-traded funds (ETFs) with exposure exceeding 200% to underlying assets. This decision, affecting 30 applications from Direxion alone, was communicated to ETF issuers such as Tidal, Direxion, and Provixion. The SEC cited Rule 18f-4 of the Investment Company Act of 1940 to justify its action, aiming to limit fund leverage risk. Industry experts, including Bloomberg’s Eric Balchunas and Alpha Architect’s Wes Gray, have endorsed the SEC's move, highlighting its role in protecting investors from excessive risk and frequent fund terminations. The SEC's public release of the letters on the same day underscores its firm stance against high-risk leverage in ETFs.