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The Securities and Exchange Commission had previously only allowed cash redemptions when the spot bitcoin ETFs were approved last January.
By Krisztian Sandor, Helene Braun|Edited by Aoyon Ashraf
Jan 24, 2025, 9:47 p.m. UTC
What to know:
- Nasdaq has filed a proposed rule change with the Securities and Exchange Commission to allow in-kind creation and redemption on the BlackRock iShares Bitcoin Trust (IBIT).
- The agency approved spot BTC ETFs with cash creation and redemption mechanism last January.
Nasdaq has filed a proposed rule change to allow in-kind creation and redemption for the BlackRock iShares Bitcoin Trust (IBIT), according to a Friday filing to the U.S. Securities and Exchange Commission (SEC).
The process allows large institutional investors, called authorized participants (APs), to buy and redeem shares of the fund directly to bitcoin (BTC).
It is considered to be more efficient as it allows APs closely monitor the demand for the ETF and to act fast by buying or selling shares of the fund without cash being involved in the process. Retail investors are not eligible to participate.
When the SEC first approved spot bitcoin ETFs including IBIT last January, the agency allowed to launch the funds with cash redemption, instead of bitcoin.
“It should have been approved in the first place but Gensler/Crenshaw didn’t want to allow it for a whole host of reasons they gave,” Bloomberg Intelligence ETF analyst James Seyffart wrote on X. “Mainly [they] didn’t want brokers touching actual Bitcoin.”
BlackRock’s IBIT is the largest spot BTC ETF on the market, attracting nearly $40 billion of inflows in its first year, making it the most successful ETF debut ever.
Krisztian Sandor recently graduated from NYU’s business and economic reporter program as a Fulbright fellow and worked with Reuters and Forbes previously. Originally from Budapest, Hungary, he is now based in New York. He holds BTC and ETH.
Helene is a New York-based news reporter at CoinDesk, covering news about Wall Street, the rise of the spot bitcoin exchange-traded funds (ETFs) and updates on crypto exchanges. She is also the co-host of CoinDesk’s Markets Daily show on Spotify and Youtube. Helene is a recent graduate of New York University’s business and economic reporting program and has appeared on CBS News, YahooFinance and Nasdaq TradeTalks. She holds BTC and ETH.
