The U.S. Securities and Exchange Commission has approved a major change for cryptocurrency exchange-traded products, allowing authorized participants to create and redeem shares of bitcoin and ether ETPs on an in-kind basis.
Announced on July 29, this move marks a shift from previous rules that limited such products to cash-only transactions.
Under the updated framework, crypto ETPs will now align with other commodity-based ETPs, a change the SEC says will lower costs and improve market efficiency for issuers, authorized participants, and investors.
I’m pleased to share the SEC approved in-kind creations and redemptions for crypto ETPs. The approvals continue to build a rational regulatory framework for crypto, leading to a deeper and more dynamic market, which will benefit all American investors. https://t.co/UbQ9pXlBpD pic.twitter.com/DX8ub16Ey3
— Paul Atkins (@SECPaulSAtkins) July 29, 2025
“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 S. Atkins. He added that in-kind creations and redemptions would streamline operations for crypto-based products while reinforcing investor protections.
Jamie Selway, Director of the Division of Trading and Markets, called the approval
“an important development for the expanding market of crypto-based ETPs,”
highlighting its potential to provide cost savings and greater flexibility across the sector.
In addition to approving in-kind transactions, the SEC advanced several related initiatives. These include the authorization for exchanges to list and trade a mixed bitcoin and ether ETP, the introduction of options and FLEX options on certain bitcoin ETPs, and an increase in position limits for bitcoin ETP options to 250,000 contracts, bringing them in line with other derivatives markets.
The SEC has also issued scheduling orders to gather public input on proposals to list two large-cap crypto-based ETPs, signalling its continued push to establish clear regulatory guidelines for digital assets.
Separately, the SEC has delayed its decision on the proposed Truth Social Bitcoin ETF, extending its review period until at least September 18. The agency stated that the extension will allow for further evaluation of the application submitted by NYSE Arca on behalf of Yorkville.
If you want to read more news articles like this, visit DeFi Planet and follow us on Twitter, LinkedIn, Facebook, Instagram, and CoinMarketCap Community.
“Take control of your crypto portfolio with MARKETS PRO, DeFi Planet’s suite of analytics tools.”
