The filing follows a similar request from Nasdaq for BlackRock’s iShares Bitcoin Trust, which also seeks to implement in-kind redemption.
BlackRock’s ETF has emerged as the largest spot Bitcoin ETF, generating nearly $40 billion in inflows since launching in January, making it the most successful ETF launch ever recorded.
While the SEC’s initial approvals for Bitcoin and Ethereum ETFs only allowed cash-based transactions, the industry is now advocating for in-kind mechanisms, indicating an evolution in both regulatory and operational approaches to crypto ETFs.
The proposed amendment, if granted approval, could establish a new standard for crypto ETF operations, potentially reducing transaction friction and increasing efficiency for institutional investors.