* Powell will decide the next step for U.S. interest rates.
* The White House will release its first official crypto report, potentially providing clues about future plans for crypto reserves.
But there is something else that just happened – and it could have a huge impact on the market.
The U.S. SEC has just approved something the entire crypto market has been waiting for – it has allowed a change to the structure of Bitcoin ETFs.
The SEC (the U.S. regulator) announced that it now allows Bitcoin ETFs to operate not only in cash but also in an “in-kind” model, meaning with the actual delivery of BTC.
What does this really mean?
Is it a good sign?
Does it mean Bitcoin will skyrocket?
Let’s see what has changed, what could happen next, and what is really worth watching.
First: what is a Bitcoin ETF?
An ETF is a fund that buys Bitcoin on your behalf. You buy its shares, just like shares of a company. You don’t need a wallet, a seed phrase, or any technical knowledge.
For many investors, especially institutions, it is a convenient and regulation-compliant way to get exposure to BTC.
How ETFs worked before (cash-only model)
* The investor deposits dollars into the fund.
* The ETF buys Bitcoin with those dollars and creates new ETF shares, which are released to the market.
* When shares are redeemed (an investor exits the ETF), the fund must sell Bitcoin to return cash.
Effect: every inflow or outflow creates real buying or selling pressure on the Bitcoin market.
What has changed – the in-kind model
The SEC now allows ETFs to also operate in the in-kind model, which means:
* The fund can accept Bitcoin directly without converting it to dollars.
* It can also deliver Bitcoin to an investor instead of cash (and the investor may not sell it immediately, reducing spot selling pressure).
This opens new opportunities for institutions that already hold BTC or prefer to operate directly in the crypto market.
Ten key points to understand:
1. The ETF itself does not buy Bitcoin by choice – this is done by authorized participants (APs).
* The ETF does not decide “let’s buy BTC now.”
* APs (banks and large institutions working with the ETF) buy Bitcoin and exchange it for new ETF shares only when it is profitable, for example, through arbitrage.
2. Not every ETF share represents new market demand.
* If someone contributes Bitcoin they already held for years, there is:
* no new market purchase,
* no new demand,
* but the ETF still increases its BTC holdings and issues new shares in exchange.
This means ETF growth does not always signal buying pressure.
3. On-chain data can be misleading.
* Seeing that an ETF “received” 10,000 BTC does not reveal whether it was purchased on the market or simply moved from a cold wallet.
* Tracking ETF inflows alone no longer clearly indicates demand.
4. Watch ETF premiums and discounts, not just inflows.
* If the ETF share price is higher than the underlying BTC value (premium):
* Arbitrage becomes profitable.
* APs buy BTC on the market, create new ETF shares, and sell at a profit.
* This generates real spot market demand.
Premiums signal institutional activity and potential upward price pressure.
5. The in-kind model can attract new firms to ETFs.
* Previously, firms avoided ETFs because:
* they were cash-only,
* the fund had to buy and sell BTC constantly,
* there were regulatory and tax limitations.
Now they can operate more flexibly without going through the dollar system.
This may boost demand for ETF shares, which could eventually force APs to buy BTC on the market.
6. In-kind means more “paper Bitcoin” in circulation.
* Each ETF share is backed by real BTC, but:
* the Bitcoin is held by custodians like Coinbase,
* the investor only holds ETF shares – no private keys, no withdrawals.
Result: a growing share of BTC is in ETFs, while fewer people truly control their coins.
ETFs provide price exposure, but not the technology, independence, or sovereignty that self-custody offers.
7. Regular firms cannot directly exchange BTC for ETF shares.
* Only APs have access to in-kind creation.
* If a company wants to “convert BTC to ETF shares,” it must:
* sell BTC and buy the ETF on the exchange, or
* use an AP (like an investment bank) to handle it.
8. The arbitrage mechanism can drive both demand and supply.
* When the ETF trades at a premium:
* APs buy BTC on the market, deposit it into the ETF, create new shares, and sell for profit.
* This creates real buying pressure.
* When the ETF trades at a discount:
* APs buy cheap ETF shares, redeem them for physical BTC, and can sell the Bitcoin on the market.
* This adds selling pressure.
Conclusion: AP arbitrage keeps ETF and spot prices aligned and can create either buying or selling pressure.
9. ETF asset growth does not guarantee a price increase.
* Growth can come from transferred BTC or AP reallocations,
* not necessarily from new market purchases.
Do not assume “ETF growth = Bitcoin price rises.”
10. For newcomers: an ETF is not the same as owning Bitcoin.
* An ETF gives price exposure, but you cannot:
* use the Bitcoin network,
* spend it, withdraw it, or transfer it,
* control your private keys.
* ETFs are convenient and simple,
* but for Bitcoin’s core idea, they are just a proxy.
Summary
* The ETF model change is an important step for institutional adoption.
* In-kind ETFs can operate faster, cheaper, and more flexibly.
* This could attract more firms and capital to the Bitcoin market.
But:
* Not every ETF move means real market demand.
* Inflows can be misleading.
* More people will “own Bitcoin” only on paper.
If you want to truly understand Bitcoin’s market impact, watch ETF premiums, AP activity, and real spot market volume.
If you want to truly own Bitcoin, self-custody is the way. ETFs are convenient, but they do not give you control.
TLDR
* For retail investors, little changes: you are still buying paper exposure to BTC.
* For institutions, the in-kind model means more flexibility, lower costs, and the ability to transact with actual Bitcoin.
Over time, this could support Bitcoin’s price by allowing large capital inflows, but it is more of a stabilizing factor than an immediate explosive catalyst.
CheckDot is SAFU
#dyor on CheckDot.