# SEC approves in-kind creations and redemptions for bitcoin and ether ETPs

> The Commission approved exchange rule changes allowing authorized participants to create and redeem covered spot bitcoin and ether ETP shares in kind, replacing the cash-only structure in the affected products.

- URL: https://riadefi.com/regulation/2025-07-29-sec-crypto-etp-in-kind-creations-redemptions/
- Posture: Agency order
- Authorities: U.S. Securities and Exchange Commission
- Event date: 2025-07-29
- Version: 1, published 2026-08-07 (first published 2026-08-07)
- Advisor-relevant: yes

## What changed

The Commission approved exchange rule changes allowing authorized participants to create and redeem covered spot bitcoin and ether ETP shares in kind, replacing the cash-only structure in the affected products. The orders govern listed-product mechanics and do not authorize advisers or retail clients to transact directly with the funds in kind.

## Who it affects

- Crypto ETP sponsors and authorized participants
- Advisers and clients holding covered crypto ETP shares
- Exchanges, market makers, custodians, and broker-dealers

## What is still open

- Product-by-product implementation, spreads, costs, and tax effects
- Treatment of later multi-asset or staking ETP structures

## What it means for an advisor

- Refresh ETP trading-cost, tax, liquidity, and tracking-error diligence after implementation
- Distinguish authorized-participant in-kind mechanics from retail shareholder redemption rights

## Previous interpretation

The covered spot bitcoin and ether ETP approvals used cash-only creation and redemption mechanics.

## Sources

1. [Order Granting Accelerated Approval of Proposed Rule Changes to Permit In-Kind Creations and Redemptions](https://www.sec.gov/files/rules/sro/nasdaq/2025/34-103571oyioi.pdf) · U.S. Securities and Exchange Commission · 2025-07-29
2. [SEC Permits In-Kind Creations and Redemptions for Crypto ETPs](https://www.sec.gov/newsroom/press-releases/2025-101-sec-permits-kind-creations-redemptions-crypto-etps) · U.S. Securities and Exchange Commission · 2025-07-29


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Published by Ketju Research on RIADeFi (https://riadefi.com). Educational research for financial professionals; not investment, legal, tax, or compliance advice.