The U.S. Securities and Exchange Commission (SEC) has announced a public comment period regarding the possibility of redeeming shares of the WisdomTree Bitcoin Fund in kind, meaning in crypto-assets instead of fiat currencies. Market participants have 21 days to submit their opinions.
This is reported by Finway
Essence of the Initiative and Benefits for Investors
Previously, during the launch of the first spot Bitcoin ETFs, providers opted out of the in-kind redemption model, despite its numerous advantages, including reduced tax burdens. Notably, BlackRock — the issuer of the largest spot Bitcoin ETF by assets, IBIT — actively advocated for this model. In January 2025, following a change in SEC leadership, several companies, including BlackRock, submitted applications to alter the redemption procedure for shares in their Bitcoin funds. WisdomTree submitted a corresponding application at the end of February.
The in-kind redemption mechanism allows investors to receive Bitcoin or other cryptocurrencies instead of fiat money when redeeming ETF shares. This could significantly change the approach to investing in cryptocurrency funds for a wide range of market participants.
SEC Examines Possible Consequences
The consideration of the WisdomTree Bitcoin Fund’s application for implementing in-kind share redemption has been postponed for the second time. The previous delay occurred in April 2025 alongside applications from other funds also seeking to implement similar changes. The SEC urges all interested parties to provide written comments within 21 days to consider the legal and political aspects of the issue.
“The request for comments is timely given the legal and political issues raised by the proposed rule change. This does not mean that the Commission has reached any conclusions regarding any of the issues raised. Rather, the Commission is seeking and encouraging interested parties to provide comments on the proposed rule change,” the statement reads.
It is currently unknown whether the SEC will apply the maximum possible review period of 240 days allowed for rule changes.