BlackRock's iShares Bitcoin ETF may undergo a significant update that would allow institutional investors to redeem ETF shares for Bitcoin directly, a change from the current practice of cash redemptions. This proposed rule change, filed by Nasdaq, suggests a streamlined redemption process that could lead to less selling pressure on Bitcoin when redemption requests occur. The U.S. Securities and Exchange Commission (SEC) recently rescinded a guidance, known as Staff Accounting Bulletin No. 121, which previously complicated cryptocurrency custody for banks, indicating a shift toward clearer regulations in the crypto space. These changes could enhance the efficiency of ETF trading and potentially reduce volatility by limiting forced sales during redemption requests. Market analysts suggest that while retail investors might not notice immediate changes, the impacts will primarily benefit institutional operations within the cryptocurrency market.

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