SEC Seeks Input on In-Kind Redemptions for WisdomTree Bitcoin Fund

The proposal, if approved, would let authorized participants exchange Bitcoin directly for shares of the ETF, rather than using cash—a structure often favored for its tax efficiency and lower transaction costs.

This move comes after earlier delays and feedback requests for similar in-kind mechanisms involving other crypto ETFs, including BlackRock’s iShares Bitcoin Trust (IBIT), VanEck’s Bitcoin Trust, and the VanEck Ethereum Trust, according to The Block.

Public Comments Open for 21 Days

The SEC’s latest notice, issued Monday, invites stakeholders to submit written comments, data, or legal arguments on the proposed change within a 21-day window.

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The in-kind creation model has become a focal point for issuers aiming to optimize cryptocurrency ETF structures. While cash-based models currently dominate due to regulatory hesitations, many asset managers—including WisdomTree—believe in-kind methods could improve efficiency and align ETFs with traditional commodity fund practices.

The SEC has not set a firm timeline for a final decision but has signaled an increasing willingness to re-evaluate long-standing restrictions as institutional interest in crypto ETFs grows.

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