Nasdaq seeks to streamline BlackRock Bitcoin ETF with cash redemptions; Understand

A major change is coming to the exchange-traded fund (ETF) based on Bitcoin from BlackRock. Recently, Nasdaq submitted a proposal to the Securities and Exchange Commission (SEC) seeking to implement an “in-kind” redemption system for the iShares Bitcoin Trust (IBIT), as um document filed on January 24th.

Since approving the first spot Bitcoin ETFs in January last year, including BlackRock’s IBIT, the SEC has opted to authorize the launch of these funds with a cash redemption model. Now, Nasdaq is proposing a change that could bring more efficiency to the process.

The big advantage of “in-kind” redemptions is that they allow large institutional investors, known as Authorized Participants (APs), to buy and redeem ETF shares directly in Bitcoin. In other words, instead of using cash in the transaction, they will be able to use the cryptocurrency itself.

This change is considered more efficient for several reasons. One of the main ones is that it allows APs to closely monitor demand for the ETF and act more quickly, buying or selling shares in the fund without having to intermediate the conversion to cash. This simplifies the process and can reduce operational costs.

BlackRock Hits $60 Billion in Bitcoin ETFs

BlackRock hits new milestone by consolidating over $60 billion worth of Bitcoin (BTC) through its iShares Bitcoin Trust (IBIT). In recent weeks, the firm has seen a sharp increase in inflows into the ETF, surpassing 574 BTC in its portfolio and highlighting the interest of institutional players in cryptocurrencies.

A recent report showed that Bitcoin ETFs totaled US$188,7 million in investments, with BlackRock accounting for US$154,6 million, representing approximately 81% of the total. This movement reinforced the manager's leading role as one of the largest holders of the asset, even surpassing well-known companies in the crypto universe.

At the time of publication, the price of Bitcoin was quoted at US$104.755, down 0.7% in the last 24 hours.