SEC Seeks Feedback on WisdomTree Bitcoin Fund Proposal

The SEC is seeking public feedback on a proposed rule change for the WisdomTree Bitcoin Fund concerning in-kind creations and redemptions, announced June 2, 2025, through the Cboe BZX Exchange.

The proposal could affect Bitcoin’s market due to potential institutional involvement, emphasizing the ongoing regulatory approach to cryptocurrency exchange-traded funds.

The SEC is considering a proposed rule change allowing in-kind transactions for the WisdomTree Bitcoin Fund. This initiative by the Cboe BZX Exchange could alter the way the fund operates, enhancing efficiency and lowering costs.

Key entities including the SEC and WisdomTree are involved. The SEC issued a notice on June 2, 2025, initiating public discussion. The proposal’s aim is to permit in-kind creations and redemptions, affecting fund management dynamics.

The potential rule change might streamline the management processes of Bitcoin ETFs. Investors anticipate a reduction in operational costs and minimal tracking errors. Public reactions are mixed, with some expressing optimism while others are cautious.

Experts suggest increased institutional participation could arise, altering Bitcoin market dynamics. Historical trends indicate that similar moves generally impact market liquidity positively. The SEC continues to analyze these implications carefully.

Comparatively, SEC deliberations over crypto ETFs follow a cautious route. Historical instances, such as past delays in crypto ETF approvals, underscore the regulatory body’s vigilant approach towards crypto-related financial products.

A Kanalcoin analyst mentioned potential outcomes may vary, noting SEC’s interest in market effects of in-kind transactions. Observations are made based on data and trends from previous ETF decisions, predicting a shift in fund management practices. Stephanie Fouse, Assistant Secretary, SEC, noted,

“The Commission is instituting proceedings to allow for additional analysis of the proposed rule change’s consistency with the [Securities Exchange] Act.”