Catenaa, Friday, February 07, 2025 – The US Securities and Exchange Commission(SEC) is considering a proposal to allow in-kind redemptions for BlackRock spot Bitcoin exchange-traded fund, marking a potential shift in how the product operates.
In a filing posted Thursday, February 06, the SEC acknowledged the proposal and requested public comments within 21 days after its publication in the Federal Register.
The agency may then approve, reject or initiate further proceedings.
Nasdaq, on behalf of BlackRock, submitted an amended rule filing last month to permit in-kind creations and redemptions for the iShares Bitcoin Trust, according to a Form 19b-4 filing.
More than a year ago, when the SEC debated approving spot Bitcoin ETFs, the agency required a cash-based redemption model, forcing issuers to sell Bitcoin and distribute cash to investors. However, this latest proposal could allow authorized participants—not individual investors—to redeem Bitcoin directly.
The move follows the SEC’s landmark approval of multiple spot Bitcoin ETFs, including BlackRock’s, in January 2024. Bloomberg Intelligence ETF analyst James Seyffart noted that the change, if approved, would primarily impact market makers and liquidity providers.
