The SEC Allows In-Kind Redemptions for All Spot Bitcoin and Ethereum ETFs, Allowing Institutions to Exchange Directly for BTC or ETH Without Going Through the Dollar.
A Major Turning Point for US Crypto ETFs
This is a significant turning point for crypto ETFs in the United States. The SEC just authorized in-kind creations and redemptions for all Spot Bitcoin and Ethereum ETFs. In other words, institutional investors can now exchange ETF shares directly for BTC or ETH, bypassing the dollar.
A Logistical Revolution for Wall Street
Until now, ETF managers had to systematically convert crypto into cash to create or redeem shares. A heavy, costly, and especially slow operation.
With this SEC green light, institutions will be able to operate in a native crypto environment. The effects are immediate:
– Less fees,
– Less friction,
– Less delays,
– Increased efficiency to arbitrate and respond to demand.
A small regulatory line, a giant leap for crypto finance.
Paul Atkins, a New Pro-Crypto Sheriff at the SEC?
Behind this historic shift: Paul Atkins, newly appointed at the helm of the SEC. A former commissioner known for his pro-market stance, Atkins is making a clear turn with his initial decisions.
“It’s a new day for the SEC,” he said in a statement. His stated goal: to build a tailored framework for digital assets. The message is strong, especially in a context where US crypto regulation has long been synonymous with obstruction.
BlackRock Leading the Charge, but Not Alone
BlackRock was the first to initiate the request back in January 2025 for its iShares Bitcoin Trust. Fidelity, Ark Invest, and other industry giants quickly followed suit.
They were all ready. The SEC has just opened the floodgates for them.
Result: A rapid increase in volumes on BTC and ETH ETFs can be expected, driven by a now much smoother infrastructure.
The Domino Effect on Altcoin ETFs with Staking
The SEC’s approval for in-kind BTC and ETH spot ETFs opens a gateway to a whole new segment: ETFs based on altcoins offering staking. This previously marginal possibility is now plausible for assets like Solana (SOL), Injective (INJ), or even Cardano (ADA). These combine token price exposure and yield through staking rewards, a double leverage of attractiveness for professional investors.
On that front, REX-Osprey has already launched the first Solana ETF with staking (SSK) in early July 2025. This product surpassed $100 million in assets under management in just a dozen days, demonstrating a real appetite for this almost unprecedented format in the United States.
And this is just the beginning: Canary Capital, via the BZX Exchange, filed a proposal in July for an Injective ETF (INJ) also with integrated staking, potentially the third of its kind after Solana and Ethereum.
Other Relaxations in Parallel
The SEC didn’t stop there. They also raised position limits on IBIT ETF options. This allows investors to take larger positions, better hedge, and provide more liquidity.
It’s another clear message to the markets: crypto ETFs are mature, liquid, and sufficiently regulated to accommodate a massive influx of institutional capital.
What Now?
With this decision, the SEC finally aligns crypto ETFs with traditional market standards. No more artificial technical barriers. No more forced conversion into fiat.
The message is clear: crypto is entering the adult era of finance.
