SEC’s Hester Peirce Says In-Kind Crypto ETF Redemptions Could Come Soon - Unchained

SEC Commissioner Hester Peirce, who also heads up the agency’s Crypto Task Force, signaled that in-kind redemptions for crypto exchange-traded funds (ETFs) are “on the horizon” and could soon become a reality.

“I can’t prejudge, but we hear that there’s a lot of interest,” she added.

In-kind redemptions allow investors to exchange ETF shares directly for the underlying asset rather than receiving cash, which is the current standard for spot crypto ETFs approved by the SEC in early 2024.

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Peirce made these remarks while speaking on a panel at the Bitcoin Policy Institute, noting that multiple filings requesting in-kind creation and redemption mechanisms — such as those submitted by Nasdaq on behalf of BlackRock in January 2025 — are currently under review by the SEC.

A shift to in-kind redemptions is expected to reduce operational friction, lower tax implications, and improve the efficiency of crypto ETFs, making them more attractive to institutional investors and aligning their structure with traditional equity ETFs.