#Glossary:
▪️In-kind Creation vs Cash Creation: In an
in-kind creation, a participating firm or institution would deliver matching assets (ex. Bitcoin), and receive shares of the spot Bitcoin ETF in return.
In a
cash creation, the participant would instead deliver cash to receive shares of the ETF.
▫️Though in-kind creations are common, cash creation might be preferred in the case of spot Bitcoin ETFs because broker-dealers cannot deal in Bitcoin.
▫️Cash creates would leave issuers responsible for transacting in Bitcoin, while brokers would be allowed to avoid relying on unregistered subsidiaries and third-party firms.
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