Just-In: US SEC Delays Decision on VanEck In-Kind Create Bid For Bitcoin ETF
Highlights
- US SEC said it needs more time to decide whether it will apply in-kind creation on crypto ETFs
- This redemption model will help create more liquidity in the market for BTC and ETH
- Market trend is shifting with new US SEC pro-crypto stance, fueling expectations of possible approval
The US Securities and Exchange Commission (SEC) has delayed its decision to approve VanEck’s request for In-Kind creations for the spot Bitcoin ETF application. This decision also impacts WisdomTree and extends to the spot Ethereum ETF offering.
Asset managers conceded this redemption model before approving the spot Bitcoin and Ethereum ETF products last year. VanEck and WisdomTree’s renewed push shows the US SEC’s change in stance on the crypto ecosystem.
US SEC Defines New Date for In-Kind Creates Bid
According to the market regulator, as shared on X by Eleanor Terrett, the new date to consider for deciding on the In-Kind creation and redemption is June 3. With In-Kind creations, stakeholders exchange the underlying Bitcoin and Ethereum directly, eliminating the need to first convert the funds to cash.
The US SEC initially opposed in-kind creation and redemption for various reasons. One major one is that it avoids taxable events and helps maintain liquidity and price stability. This latest postponement comes as the SEC also delayed its decision on Grayscale staking bid for its Ethereum ETF.
Based on general market perception, this careful approach shows that the SEC is trying to find the right balance. Letting ETFs use in-kind setups could make them work better and attract more traders. However, the agency likely wants to ensure the market has a proper structure before proceeding.
US SEC and Push for Altcoin ETFs
It is worth noting that since the start of the year, the US SEC has delayed decisions on several altcoin ETF proposals. These include filings for XRP, Solana, Dogecoin, and Litecoin.
Grayscale and Bitwise submitted new filings, but approvals remain pending. Recent reports show that the US SEC has delayed its decision on a Dogecoin ETF, threatening its long-term price valuation alongside other altcoins.
Meanwhile, after nearly nine months since Nasdaq’s initial filing, the regulator has approved options trading for Ethereum spot ETFs. This has added to the optimism that Paul Atkins’ time as SEC Chair may lead to more ETF approvals.
What to Expect for Crypto Under Paul Atkins?
According to reports, Paul Atkins was confirmed by the Senate as the commission’s Chairman on April 9. His appointment brought a wave of excitement to the market. Many believe this change signals a new path for crypto regulation. This is because Atkins is known for supporting market innovation and has often criticized strict rules from the past.
Market participants expect the SEC to move faster on reviewing crypto fund applications after his appointment. XRP, Solana, and Dogecoin ETFs are still waiting for a decision. Based on current filing timelines, these reviews could take a few more months before completion.
According to reports, immediate approvals are unlikely, but multiple decisions could be reached together.
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