SEC Delays Decision on BlackRock’s iShares Bitcoin Trust In-Kind Redemption: Implications for Bitcoin ETF Trading Efficiency

In a significant development for cryptocurrency markets, the U.S. Securities and Exchange Commission (SEC) has postponed its ruling regarding BlackRock’s iShares Bitcoin Trust’s proposed in-kind redemption mechanism. As reported by TheBlock on May 14, the SEC is soliciting public feedback on this proposal. Currently, the prevailing cash redemption system necessitates that custodians liquidate Bitcoin before returning cash to investors, a process that can lead to inefficiencies.

Financial analysts note that enabling in-kind redemptions could substantially enhance the trading efficiency of exchange-traded funds (ETFs). Additionally, the SEC has also delayed decisions on various other crypto-related investment trusts, including the Grayscale Litecoin Trust and Grayscale Solana Trust. Meanwhile, the proposed Dogecoin ETF from 21Shares has entered the public comment phase, highlighting ongoing regulatory scrutiny within the cryptocurrency space.