Blockchain Industry | How are ETF shares created and redeemed?
When U.S. spot Bitcoin and Ethereum ETFs first launched, creations and redemptions were only allowed in cash. In July 2025, the SEC approved in-kind creations and redemptions for crypto-asset ETPs.
ETF flows reflect only changes in the number of fund shares. A party creating shares may simultaneously hedge elsewhere, so these flows should not be viewed directly as new buying.
Spot Bitcoin ETF shares are backed by $BTC actually held in custody by the issuer.
Every return comes with a corresponding risk. Think carefully about the worst-case scenario.
When U.S. spot Bitcoin and Ethereum ETFs first launched, creations and redemptions were only allowed in cash. In July 2025, the SEC approved in-kind creations and redemptions for crypto-asset ETPs.
ETF flows reflect only changes in the number of fund shares. A party creating shares may simultaneously hedge elsewhere, so these flows should not be viewed directly as new buying.
Spot Bitcoin ETF shares are backed by $BTC actually held in custody by the issuer.
Every return comes with a corresponding risk. Think carefully about the worst-case scenario.