NASDAQ is currently aiming to make Bitcoin replacement funding (ETF) easier.
The exchange was submitted to the US Securities and Exchange Commission (SEC) to allow BLACKROCK’s ISHARES Bitcoin Trust (Ibit) to redeem the “actual” bitcoin.
This makes Bitcoin ETF more instantaneous and reduced redemption costs.
If approved, the approved participant (APS) can exchange the ETF shares of the bitcoin itself, not in cash. Until now, Bitcoin had to be sold to deliver cash to investors. This has been called complicated and costly.
This proposal is called “substitute for the current cash creation and redemption process of the trust.”
However, it is important to note that this change is not applied to retail investors. Reduction of the actual thing is only for participants of institutions such as AP. However, experts believe that by making Bitcoin ETF more efficient, this will still benefit everyday investors.
The cash redemption model has been introduced since January 2024, when the SEC first approved the first approved spot -bit coin ETF. SEC chose cash redemption for the simplicity of regulations, as brokers and financial companies do not want to deal with bitcoin itself.
In the post of X, Bloomberg ETF analyst James Sejato announced the news and engaged in an enlightened conversation with users who wanted to better understand the meaning.
He said that the regulatory authorities were hesitant to allow the actual transfer at the time because the broker did not want to touch the actual bitcoin.
As the Bitcoin ETF market continues to grow, NASDAQ and BLACKROCK believe that the time has come to a more efficient model. Reduction of the actual thing reduces the measures involved in the stakeholders and the parties, reducing time and costs.
At present, Seyffart states that the ETF can now rationalize things and need to trade more efficiently than before because it is now in a deeply into the mechanism of the in -house model and the in -cash model.
Aside from operating efficiency, in -kind redemption provides tax advantages. With no need to sell bitcoin in cash, ETF minimizes capital gain distribution and enhances tax efficiency for institutional investors.
Another interesting thing about this new development is that it can reduce sales pressure on bitcoin during redemption, which can stabilize the price.
This proposal will be a part of a widespread change in bitcoin policy in the United States under the new Trump administration. Trump is a professionalbit coin, established a task force to create clear regulations, and has abolished SAB 121, which stops banking from providing digital asset management services.
These changes have created a better environment for innovation, such as the actual bitcoin redemption. Seyffart stated that the abolition of SAB 121 is an important factor in submitting Nasdaq. “The side effects of abolishing SAB 121 have just begun,” he said.
BLACKROCK’s ISHARES Bitcoin ETF has been a hit since its release in 2024. The fund has already gained over $ 60 billion and is the largest and most popular spot -coin ETF in the United States.
Recently, the fund saw the inflow of $ 2 billion in six days. NASDAQ redemption has been more attractive to institutions by providing more efficient and cost -effective models.