Catenaa, Wednesday, July 30, 2025- The US Securities and Exchange Commission has approved a landmark policy shift allowing in-kind creations and redemptions for cryptocurrency exchange-traded products, a move that aligns crypto ETPs with broader commodity-based funds.
SEC’s Media Comminuque can be seen here
Previously restricted to cash-based transactions, bitcoin and ether ETPs can now be created and redeemed in-kind, using the underlying crypto assets rather than cash.
The decision is expected to reduce operational costs, enhance market efficiency, and provide greater flexibility to authorized participants and fund issuers.
SEC Chairman Paul S. Atkins described the decision as part of a broader initiative to develop a “fit-for-purpose” regulatory framework for digital asset markets.
He said the approval marks progress toward building a rational crypto rulebook that benefits American investors and aligns with standard practices in traditional markets.
Jamie Selway, head of the SEC’s Division of Trading and Markets, said the move allows issuers and participants to operate more cost-effectively while boosting transparency and efficiency in crypto-based ETPs.
In addition, the SEC approved several related measures.
These include exchange proposals for listing a mixed spot bitcoin and ether ETP, options on bitcoin ETPs, and FLEX options tied to BTC-based products.
The Commission also raised position limits on BTC ETP options to as many as 250,000 contracts, matching generic standards.
The agency issued two scheduling orders to solicit public comment on exchange filings for two large-cap crypto ETPs, signaling further expansion in regulated crypto investment products.
