Major Bitcoin Holders Shift Assets to Regulated ETFs Post-July Rule Change
Large Bitcoin holders utilize SEC-approved in-kind creations to move BTC into ETFs like BlackRock’s IBIT, offering tax-neutral benefits and integration into traditional financial systems.
Some major Bitcoin holders are moving coins into spot exchange-traded funds via in-kind creations, converting off-platform BTC into fund shares without selling. This follows the SEC’s July 29, 2025 policy change allowing in-kind creations and redemptions for crypto ETPs, aligning them with commodity ETPs. BlackRock has processed more than $3 billion of such conversions, while Bitwise and Galaxy report growing interest. This tax-neutral method lets investors pledge assets as collateral or incorporate them into estate plans, reflecting a broader shift toward regulated, brokerage-account-based holdings.
- In-kind Creation: A process where the underlying asset, such as Bitcoin, is delivered directly to an ETF in exchange for shares, avoiding the need to sell for cash.
- Crypto ETP: A cryptocurrency exchange-traded product that gives investors exposure to digital assets and can be structured to allow in-kind creations and redemptions.
- Spot ETF: An exchange-traded fund that directly holds the underlying asset—in this case, Bitcoin—allowing investors to gain exposure to its real-time market price.