BlackRock and Ark Invest Defy SEC Guidance, Lean Towards In-Kind Bitcoin ETFs

BlackRock and Ark Invest are considering launching Bitcoin ETFs using in-kind creations and redemptions, despite the SEC's recommendation to switch to a cash model. BlackRock recently met with SEC staff to explain how both models could work, and they prefer the in-kind mode. Meanwhile, Ark Invest and Cathie Wood have submitted an updated filing for a spot Bitcoin ETF, sticking with in-kind creations and redemptions despite the SEC's advice. In-kind transactions are preferred by ETF providers for their tax efficiency and to minimize the impact on the market prices of Bitcoin.