Seyffart described the cluster of filings as a “positive” signal that the Securities and Exchange Commission (SEC) is working with issuers to finalize an in-kind framework rather than resisting it. He characterized the process as fine-tuning, not stonewalling.
Seyffart also addressed a recurring misconception. The shift to in-kind would not let retail investors swap ETF shares for Bitcoin or Ethereum directly.
Only authorized participants, such as large Wall Street firms and market makers, would be responsible for handling those transfers. For most investors, nothing will appear different on the screen because existing spot Bitcoin ETFs already trade closely to their net asset value.
The benefit is then structural, as crypto ETPs would be treated the same way as commodity and equity products that commonly use in-kind flows, enhancing tax efficiency and lowering friction inside the fund.
If the Commission signs off, authorized participants will be able to move crypto directly instead of sourcing or unwinding large cash positions each time they create or redeem baskets.
That change could reduce spreads and hedging costs, especially in volatile markets, and give issuers more flexibility in portfolio management.
Although retail wouldn’t notice the changes directly, smoother primary-market plumbing tends to reinforce secondary-market efficiency.
A Federal Register notice in late May also described full in-kind mechanics for an Ethereum trust on Nasdaq, detailing how APs would deliver or receive ether.
Collectively, these filings form the pending docket the SEC must clear before any fund can move away from the cash-only model imposed at launch.
