The U.S. Securities and Exchange Commission has approved in-kind creation and redemption for crypto exchange-traded products (ETPs). On July 29, 2025, the SEC finalized orders allowing authorized participants to exchange ETF shares directly for Bitcoin or Ethereum. This change replaces the prior cash-only model previously imposed on spot BTC and ETH ETFs.
Furthermore, major exchanges including Nasdaq, NYSE Arca, and Cboe BZX received accelerated approval to implement the new structure. Asset managers such as BlackRock, Fidelity, Ark Invest, and VanEck now can support in-kind mechanisms from the outset. Analysts expect future altcoin ETF filings to adopt in-kind redemptions by default.
This shift aligns crypto ETPs with conventional commodity ETFs, which have long allowed in-kind transactions. In turn, the change reduces trading costs, tightens pricing alignment, and improves liquidity. Additionally, it may reduce taxable events and lessen bid-ask spreads by eliminating cash conversions.
SEC Chair Paul Atkins said, “It’s a new day at the SEC,” emphasizing that the move supports a more fit-for-purpose regulatory framework. Moreover, Jamie Selway from the SEC’s Division of Trading and Markets called the change flexible and efficient for issuers and investors alike.
Implications for the Crypto Casino Industry
Most crypto casinos and online casinos currently rely on spot acquisitions of Bitcoin or Ethereum for liquidity and wagering. Therefore, in-kind redemptions may streamline settlement mechanics for institutional liquidity providers. Consequently, online casino platforms may benefit from tighter spreads and lower transaction costs.
This could further support on-chain liquidity in crypto casinos and improve user experience. Also, the increased institutional inflow may provide more robust funding to platforms accepting real money online casino bets in crypto tokens.
What This Means for Crypto ETPs
Looking ahead, ETF issuers will implement the updated mechanism in coming weeks. Combined with new rules for mixed BTC-ETH ETPs and expanded options limits, this signals regulatory momentum toward broader crypto product adoption.
As analysts suggest, this development paves the way for mainstream acceptance of crypto financial instruments.