NYSE Pushes In-Kind Crypto Swaps for Bitwise Bitcoin and Ethereum ETFs
Published Date: 7/14/2025
Notice
Summary
NYSE Arca wants to update the Bitwise Bitcoin and Ethereum ETFs to allow in-kind creations and redemptions, meaning investors can swap actual crypto assets instead of just cash. This change helps make trading smoother and could save money on fees. If approved, it’ll affect anyone investing in these ETFs and could roll out soon after the SEC finishes reviewing comments.
Analyzed Economic Effects
2 provisions identified: 1 benefits, 1 costs, 0 mixed.
Allow In-Kind ETF Creations/Redemptions
The Exchange proposes that the Bitwise Bitcoin ETF and the Bitwise Ethereum ETF be able to process in-kind creations and redemptions, meaning Authorized Participants could deliver actual bitcoin or ether to the trusts (or receive crypto) instead of only cash. The Exchange says this change would let Authorized Participants source and sell the underlying crypto themselves, improve market efficiency, and ultimately benefit end investors in the trusts.
New In-Kind Order Timing and Settlement Rules
The proposed filings set an initial In-Kind Order Cutoff Time of 3:59 p.m. ET on the purchase order date for in-kind creations and redemptions. The filings also require Authorized Participants to deposit crypto with Coinbase Custody Trust Company, LLC (for creations) or deposit ETF shares to the Trusts' DTC accounts (for redemptions), and, if delivery is not made by the applicable time on settlement date, the Authorized Participant may (1) cancel the order, (2) delay settlement, or (3) accept cash settlement handled by the Trust.
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