Sec approves “in kind” redemptions for the ETF Bitcoin and Ethereum in cash

The US stock and values commission. UU. He took a decisive step by allowing mechanisms of creation and redemption in species for ETFs based on Bitcoin or Ethereumincluding funds from Blackrock, Fidelity and Ark Invest.

***

• The Sec approved new rules that allow redemptions “In kind” For ETF Bitcoin and Ethereum.
  
• The measure allows investors to receive BTC either Eth, instead of the amount in cash associated with the value of the shares.
• This decision will benefit investors by reducing costs and improving efficiency.
  
• The president of the Sec He stressed that these measures help build a rational regulatory framework for crypto.

The United States Stock Exchange and Securities Commission (SEC) This Tuesday approved a series of measures that transform the operation of the funds quoted in the stock market (ETF) linked to cryptocurrencies. The regulator will allow these products to manage creations and redemptions “In kind”, that is, by direct delivery of the underlying asset instead of cash.

This approval applies to funds containing Bitcoin and Ethereum in cash, options on certain ETFs Bitcoin, as well as proposals with increases in position limits.

A long -awaited decision by the industry

The system “In kind” It has been requested for months by ETF transmitters, including giants as Blackrock, Ark Invest, Fidelity, Vaneck and Franklin Templeton. The Sec granted accelerated approvals for bags Nasdaq, Nyse Arca and CBOE BZXallowing these platforms to adopt the new modality for multiple funds, including those of Bitcoin and Ethereum.

This change allows authorized participants – in general, great signatures of Wall Street and market creators— Exchange ETF actions for underlying assets, such as BTC either Eth, instead of having to sell these assets first and convert them to cash.

A new regulatory position in the Sec

“It’s a new day at the SEC”, declared in a statement cited by The Block The president of the agency, Paul Atkins. “A key priority of my management is to develop an adequate regulatory framework for cryptoactive markets. These approvals will benefit investors by making these products less expensive and more efficient.”

The measure represents a turn with respect to the previous model, where the Sec He had imposed an approach exclusively in cash, forcing managers such as Blackrock to sell the asset before returning capital to investors.

According to analyst James Seyffart de Bloomberg Intelligence, For most retail users, the difference will be almost imperceptible, since current products already operate with remarkable efficiency. However, from the structural point of view, these rules match crypto ETFs with other similar products in the financial market.

Implications for ETF futures based on Altcoins

The approval also sends clear signals about the possible future treatment of other ETFs that follow alternative cryptocurrencies (Altcoins). According to Seyffart, these funds are likely to include the option to handle redemptions from the beginning “In kind.”

“The ETFS approval process for Altcoins will probably allow the In-Kind model from the beginning”Said the analyst in a publication in X shared today.

This regulatory evolution is part of a broader process to normalize the presence of digital assets in traditional markets. The new rules close even more to cryptocurrencies to the operational standards of Wall Street, which could prepare the way for greater institutional adoption and liquidity.

Let us keep in mind that ETFs are funds that allow investors to obtain exposure to an asset without having to own it directly. In the case of products based on Bitcoin either Ethereum, These are financial instruments that follow the price of these cryptocurrencies, facilitating their access from traditional investment platforms.

The redemption modality “In kind”, Already used in other types of ETFs such as shares or raw materials, it allows the purchase and sale process to be more fiscal and operationally, avoiding unnecessary to cash conversions that can generate additional costs.

The decision of the Sec It marks greater legitimation of the crypto ecosystem in the United States and establishes precedents for the future evolution of financial products based on digital assets.

Written article with the help of an AI content editor, edited by Angel Di Matteo / Diariobitcoin

Original image of Diariobitcoin, created with artificial intelligence, for free use, licensed under public domain.

WARNING: Diariobitcoin offers informative and educational content on various topics, including cryptocurrencies, AI, technology and regulations. We do not provide financial advice. Cryptactive investments are high risk and may not be adequate for all. Investigate, consult an expert and verify the applicable legislation before investing. I could lose all its capital.

Subscribe to our newsletter