SEC Gives Green Light to In-Kind Transactions for Crypto ETPs

The US Securities and Exchange Commission (SEC) has approved in-kind creation and redemption for cryptocurrency exchange-traded products (ETPs), allowing investors to exchange shares directly for the underlying crypto assets instead of cash.

In a Tuesday announcement, the regulator stated that approved Bitcoin (BTC) and Ether (ETH) funds will be permitted to create and redeem shares on an in-kind basis.

“It’s a new day at the SEC, and a key priority of my chairmanship is developing a fit-for-purpose regulatory framework for crypto asset markets,” said SEC Chairman Paul Atkins in a statement.

Atkins said the new rules will make crypto ETPs “less costly and more efficient.”

“In-kind creation and redemption provide flexibility and cost savings to ETP issuers, authorized participants, and investors, resulting in a more efficient market,” said Jamie Selway, Director of the Division of Trading and Markets at the SEC.

This is a developing story, and further information will be added as it becomes available.