Galaxy Powers Crypto ETFs
Galaxy Powers Crypto ETFs
Supporting in-kind activity for BlackRock’s iShares Bitcoin Trust and other crypto ETFs
When spot bitcoin ETFs launched in the U.S., they marked a major milestone in crypto’s integration into traditional finance. But access alone doesn’t define success. How efficiently an ETF trades once it’s live matters just as much.
That’s where understanding crypto market structure and liquidity matters. And it’s an area where Galaxy has deep expertise.
Following regulatory approval for in-kind creations and redemptions last year, Galaxy has been supporting in-kind activity for BlackRock’s iShares Bitcoin Trust (Nasdaq: IBIT), as well as other crypto ETFs, by working closely with authorized participants to help facilitate these processes on behalf of clients.
Previously, spot crypto ETFs relied on cash-only creations and redemptions. In-kind functionality allows authorized participants to exchange bitcoin and other cryptocurrencies directly for ETF shares—the same proven mechanism used across equity and fixed-income ETFs. While the change may sound technical, it represents a meaningful upgrade to how crypto ETFs function: tightening bid-ask spreads, reducing tax friction, and placing them on the same structural footing as the ETFs investors already rely on.
Galaxy’s role behind the scenes
Galaxy maintains relationships with multiple APs and leverages its deep network of counterparties (over 1,500 around the world) to support in-kind creation and redemption activity efficiently on behalf of clients.
In practice, Galaxy helps coordinate the movement of bitcoin and other cryptocurrencies between clients and authorized participants, enabling the creation of ETF shares through established AP channels. This structure allows clients to access in-kind functionality while relying on Galaxy’s market expertise and deep source of liquidity.
“We’ve seen tremendous demand from clients to be able to hold some or all of their bitcoin exposure within the convenience of an ETP, allowing that exposure to sit directly within an existing brokerage or financial advisor account,” said Robert Mitchnick, Head of Digital Assets at Blackrock. “Galaxy Digital has been a pioneer in helping clients navigate the conversion process.”
By operating at the intersection of digital asset markets and traditional ETF plumbing, Galaxy helps improve execution quality and market efficiency without sitting directly in the AP role.
“Supporting in-kind activity is a natural extension of Galaxy’s role bridging digital assets and traditional finance,” said Michael Harvey, Head of Franchise Trading at Galaxy. “By working alongside authorized participants, we’re helping reinforce the efficiency and resilience of the crypto ETF ecosystem using the same proven mechanics that underpin traditional ETFs.”
Connecting crypto liquidity to ETF markets
Galaxy has spent years operating in complex crypto markets, providing liquidity, managing risk, and executing in environments where precision matters. That experience translates directly to today’s crypto ETF landscape, where institutional infrastructure and disciplined market design are essential.
As more crypto ETFs come to market, Galaxy is helping connect institutional-grade crypto liquidity with ETF ecosystems, strengthening the bridge between onchain assets and traditional financial. It’s part of Galaxy’s broader mission to make crypto markets more durable, efficient, and accessible.
“Crypto ETFs are maturing into true institutional products,” said Steve Kurz, Global Co-Head of Digital Assets at Galaxy. “By helping apply in-kind mechanics and traditional ETF market structure to digital assets, Galaxy is supporting a more efficient, scalable, and investor-friendly ecosystem.”
Learn more about Galaxy’s trading capabilities here. To speak with someone at Galaxy, contact our team.
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