The Lines Between Spot Crypto ETFs and Direct Ownership Will Blur in 2025
2024 saw the launch of Bitcoin and ether spot ETFs, which quickly became among the fastest-growing in history. The anticipated changes in 2025 focus on the implementation of in-kind redemptions for these ETFs, allowing investors to engage directly with cryptocurrencies without immediate tax implications. This shift could unlock billions in sidelined crypto assets, particularly benefiting crypto-native investors with low-basis assets. It also opens doors for traditional investors to explore decentralized finance (DeFi) ecosystems more freely. Additionally, regulatory shifts, such as the withdrawal of certain SEC constraints, are expected to encourage traditional finance institutions to develop crypto-native financial products. As a result, 2025 is set to blur the lines between traditional finance and decentralized finance, enhancing market liquidity and facilitating detailed interactions between the two sectors. The evolving landscape will favor investor autonomy, self-custody of assets, and the seamless integration of on-chain assets into financial strategies.
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