30.07.2025 07:21
The United States Securities and Exchange Commission (SEC) has significantly altered the landscape of Bitcoin and Ethereum exchange-traded products (ETPs) by authorizing in-kind redemptions. This landmark decision, announced in a recent press release, allows authorized participants to create and redeem ETP shares using actual Bitcoin or Ethereum, abandoning the previous cash-only restriction.
This shift brings Bitcoin and Ethereum ETPs into alignment with established regulations governing commodity-based ETPs, such as gold-backed funds. According to SEC Chairman Paul S. Atkins, in a post on X (formerly Twitter), these regulatory adjustments aim to foster a more robust and efficient structure for cryptocurrency markets. The new system, he explained, should translate to lower costs and enhanced efficiency for both investors and market participants. Echoing this sentiment, Jamie Selway, Director of the Division of Trading and Markets, highlighted the enhanced operational flexibility and substantial cost savings this approval offers the burgeoning crypto ETP marketplace.
Further expanding the regulatory framework, the SEC approved several consequential orders concurrently. These included the green light for options trading on select spot Bitcoin ETFs, along with FLEX options on Bitcoin-based ETP shares. A notable revision involves a substantial increase in position limits for Bitcoin ETF options, soaring from 25,000 contracts to a remarkable 250,000 – a tenfold expansion. This dramatic increase is projected to energize the derivatives market for Bitcoin ETPs considerably.
The SEC's actions, gleaned from official statements and internet sources, demonstrate a proactive approach to regulating the cryptocurrency market, aligning it more closely with traditional financial instruments while simultaneously fostering innovation and accessibility for investors. These sweeping changes are likely to have a profound impact on the future development and trading activity within the cryptocurrency ETP sector.
