Nasdaq has filed a request with the SEC to change the operational structure of the proposed BlackRock Ethereum ETF to include in-kind redemptions.
What’s Happening with the Nasdaq SEC Filing
The recent filing by Nasdaq is a formal request to the SEC to allow BlackRock’s ETHA to utilize in-kind redemptions, moving away from cash-only redemptions outlined in the initial proposal.
Why Is In-Kind Redemption Important for a Crypto ETF
In-kind redemptions can be more efficient as they bypass the need to buy and sell the underlying cryptocurrency. They may also offer tax advantages by potentially avoiding capital gains taxes.
Potential Impacts on the Ethereum ETF Market
If the SEC approves the in-kind redemption mechanism, it could lead to increased institutional interest and improve market functioning, setting a precedent for future crypto ETFs.
Nasdaq’s filing for in-kind redemptions for the BlackRock ETH ETF marks a significant step toward bringing this product to market, indicating the industry's preference for an efficient redemption model.
