Nate Geraci, president of The ETF Store, shared his initial concerns regarding a new Treasury notice on 351 exchanges. Posting on X on Tuesday, September 29, 2026, at 00:19:48 UTC, Geraci stated, "Fwiw, my initial read on this Treasury notice re: 351 exchanges isn’t nearly as positive as what I’m seeing from industry colleagues… If portfolio being transferred in is materially different from underlying ETF strategy, that could be problematic. Especially if those transferred in holdings are then quickly reduced or completely divested via in-kind redemption. That said, this Treasury “guidance” should have been *much* clearer. Extremely difficult to figure out where the boundaries are here. Sounds like addn’l guidance will be forthcoming though."
Geraci's comments come as exchange-traded funds, particularly those tracking digital assets, continue to attract significant investor interest. Recent reports highlighted that Bitcoin ETFs flipped to positive flows, logging $2.39 billion in inflows last week. This marked the largest weekly total since their launch, erasing the 2026 deficit and underscoring the growing adoption of these investment vehicles.
Geraci's view suggests that the current Treasury guidance lacks sufficient clarity, potentially creating operational hurdles or compliance risks for ETF providers. The ambiguity around asset transfers and in-kind redemptions, particularly when transferred portfolios differ substantially from the ETF's core strategy, could complicate management. His expectation of additional guidance implies that the industry will be watching for further clarification to facing these regulatory boundaries.
