Bitwise Asset Management said it has completed the industry’s first in-kind creation and redemption for a spot Bitcoin exchange-traded fund, allowing an authorised participant to deliver Bitcoin directly in exchange for ETF shares rather than settling the trade in cash.
Market participants say the shift to in-kind transactions could lower operational costs, narrow bid-ask spreads and reduce management fees by removing the need for issuers to convert cash into Bitcoin and vice-versa. The move also aligns the structure of Bitcoin funds with that of many commodity ETFs that already permit in-kind settlements.
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