ETF Amendments Filed by Cboe Global Markets: A Step Forward for Crypto Market Evolution?
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Title: Positive Sign for In-Kind Redemption of Bitcoin and Ethereum ETFs as Cboe Files Amendments
A recent development has brought a “positive” signal to the approval process for in-kind redemptions in Bitcoin and Ethereum exchange-traded funds (ETFs), according to Bloomberg Intelligence ETF analyst James Seyffart. This breakthrough comes as Cboe Global Markets files amendments, paving the way for the long-awaited change.
Cboe’s move is part of a growing queue of filings that aim to introduce flexibility into the crypto market by allowing authorized participants (APs) to create and redeem ETF shares in-kind, rather than relying on cash flows. This shift would bring significant benefits to the market, including enhanced tax efficiency and reduced friction within funds.
Notably, the proposed change will not directly impact retail investors. Instead, it will primarily benefit large financial institutions, such as Wall Street firms and market makers, who currently handle these types of transfers. The alteration would result in smoother primary-market plumbing, ultimately reinforcing secondary-market efficiency.
While this development may seem insignificant to individual traders, it holds considerable significance for institutional players and the overall ecosystem. As such, this positive signal is a significant step forward in fostering a more efficient market environment.
The amendment filing joins a growing list of similar requests, with Nasdaq having previously requested that BlackRock’s iShares Bitcoin Trust be converted to in-kind creations and redemptions, following language outlined in January 2024. Furthermore, a Federal Register notice from late May detailed full in-kind mechanics for an Ethereum trust on Nasdaq.
This development has been met with mixed reactions within the community, with some experts praising the move as a significant step forward, while others have expressed concerns regarding potential risks and challenges associated with the shift.
Regardless of individual opinions, this amendment filing marks a crucial milestone in the ongoing evolution of the crypto market.
Source: cryptoslate.com
