Nasdaq, Cboe Seek Approval of BTC ETF Options, SEC Acknowledges Proposal

Key Takeaways

The Cboe filing seeks permission to trade options for a “Bitcoin-holding ETP.”

The Nasdaq filing aims to list and trade options on BlackRock’s iShares Bitcoin Trust.

Nasdaq and Cboe have filed a 19b-4 filing with the Securities and Exchange Commission (SEC) to amend their listing rules, seeking approval to trade options on their Bitcoin exchange-traded fund (ETF). The SEC approved these proposals on January 19th, marking a significant step forward in expanding the cryptocurrency investment landscape.

Nasdaq’s filing aims to list and trade options on BlackRock’s iShares Bitcoin Trust, while Cboe is seeking permission to trade options for an “ETP holding Bitcoin.” The move follows the recent approval of a Bitcoin ETF on both Nasdaq and Cboe, which began trading on January 11, receiving positive attention from investors.

Cboe Senior Vice President Catherine Clay expressed optimism about the potential of Bitcoin ETF options trading, saying it would add utility and risk mitigation to these products. Options, a derivative instrument that allows holders to buy or sell an asset at a predetermined price and time, are seen as the “next logical step” for a BTC ETF. Nasdaq emphasized in its filing that options can provide “cost efficiencies and improved hedging strategies.”

VettaFi analyst Dave Nadig expects a surge in hedge fund interest in the Bitcoin ETF options space, leading to expanded participation by traditional financial players in the cryptocurrency ecosystem.

Cboe’s options clearing firm has also filed similar filings with the SEC and Commodity Futures Trading Commission.

Citing the surprising speed of Nasdaq’s announcement, Bloomberg ETF analyst James Seyffart speculated that options trading approval could potentially arrive before the end of February, or around September 21 at the latest. The SEC typically takes time to respond to such requests, but this time Seyffart suggests a faster decision.

Under the proposed rule change, the SEC opened a 21-day period for public comment and feedback. Industry experts, including Seyffart, believe the SEC could make a decision on these filings by the end of February, but a ruling could be delayed until September.

The move toward approval of Bitcoin ETF options includes the Grayscale Bitcoin Trust, Bitwise Bitcoin ETF, Hashdex Bitcoin ETF, iShares Bitcoin Trust and Valkyrie Bitcoin Fund. It follows the SEC’s approval of 11 spot Bitcoin exchange-traded funds, including . Analysts predict that this approval will bring more stability to the Bitcoin price in the long term and potentially reduce liquidity risk over time, indicating growing acceptance of the cryptocurrency in traditional financial markets. Pay it.

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