BlackRock's iShares Bitcoin Trust ETF may soon enable in-kind Bitcoin redemptions rather than cash, following a recent proposal filed with Nasdaq. This change would allow authorized participants, typically institutional investors, to redeem ETF shares directly for Bitcoin, simplifying the process and potentially reducing overall selling pressure. Currently, ETF redemptions require cash transactions, which can lead to additional market selling. The new rule could streamline redemptions and enhance ETF efficiency. This follows a significant regulatory shift under the new SEC leadership, which rescinded Staff Accounting Bulletin No. 121, easing rules concerning crypto-assets held on behalf of users. The proposed updates, if approved, could create clearer and more efficient structures for Bitcoin ETFs and foster a more robust market environment.

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