SEC Approves In-Kind Redemptions for Crypto ETPs

The United States Securities and Exchange Commission (SEC) has taken a significant step forward in the cryptocurrency market. On Tuesday, the SEC voted to allow authorized participants to create and redeem shares of crypto asset exchange-traded products (ETPs) through in-kind transactions. This decision marks a pivotal change in how these products can be managed, offering a more efficient and cost-effective approach for investors.

Benefits for Investors

"I am pleased the Commission approved these orders permitting in-kind creations and redemptions for a host of crypto asset ETPs. Investors will benefit from these approvals, as they will make these products less costly and more efficient," stated SEC Chairman Paul Atkins. This move is expected to lower the barriers to entry for investors looking to diversify their portfolios with crypto assets.

A Shift from Previous Approvals

Previously, the SEC had approved spot Bitcoin ETPs in January and Ether ETPs just last week. However, these products were limited to in-cash creations and redemptions. Today's approval expands the options available to authorized participants, paving the way for a more flexible and accessible crypto investment landscape.