This "in cash" thing about the ETF is ticking me off. They're just looking for a way into paper btc, which as of now isn't a (real) thing. They will have their way, I'm sure.
I hope they get burned by the mightiest short squeeze on the "underlying" the Earth has ever seen. That will teach them and enrich others (notably, some of the people reading these words).
I don't the correlation between in-cash and paper BTC. Bitcoin ETF will be a highly regulated product, given the position of the SEC.
I don't see a problem with "in-cash" settlement, considering most in market participants would be entering in cash, would make sense from a financial/accounting side to exit in-cash as well.
Some drawbacks floating around is fees/fees and more fees. Given the state of the mempool, i think settlement in cash maybe more of an advantage, given the cost to sell on and exchange is less than 1%