CoinShares ETFs to Liquidate on October 21, Potentially Impacting Social Security Benefits

CoinShares is closing two of its cryptocurrency exchange-traded funds (ETFs) on October 21, 2026. The affected ETFs are CoinShares Bitcoin and Ether ETF (BTF) and CoinShares Altcoins ETF (DIME). Shareholders who still hold these shares after the closure will receive cash equal to the net asset value once expenses and liabilities have been paid.

The liquidation of these ETFs can trigger a taxable sale for shareholders, which may impact their Social Security benefits. The Internal Revenue Service (IRS) considers combined income when determining how much of an individual's benefit is taxable. For single taxpayers, benefits start becoming taxable above $25,000 and up to 85% can be taxed if the combined income exceeds $34,000.

A retiree who holds BTF in a taxable brokerage account may face an unexpected tax event due to the liquidation. The size of the gain or loss depends on the shareholder's cost basis, which is the original price paid for the shares. If the cost basis is low, the liquidation can result in a significant gain, pushing more of their Social Security benefit into taxable income.

Shareholders can avoid this situation by selling their shares before October 20, but this will still be considered a taxable sale. It's essential to review one's account type, cost basis, and other 2026 income to determine the impact of the liquidation on their tax obligations.