SEC Makes Decision on Options Trading on Spot Ethereum ETF
The U.S. Securities and Exchange Commission (SEC) delay The New York Stock Exchange (NYSE) announced on November 8 that it had decided to approve options trading for the Ethereum (ETH) exchange-traded fund (ETF). filing.
The regulator noted that it needed additional time to review the proposal and assess its impact on the market. The decision concerns Bitwise’s ETHW, Grayscale’s ETHE and Ethereum Mini Trust, and BlackRock’s ETHA.
The regulator had previously postponed the decision deadline for ETHW and ETHA to September 26, the first delay for a Grayscale fund.
Last August, Bloomberg ETF analyst James Seyffart said the SEC’s decision regarding Ethereum ETF options Come in April 2025.
Specifically, the SEC stated in the filing that stakeholders have 21 days to submit arguments on whether an option for an Ethereum ETF should be approved or not approved.
The document also emphasized that even if the Options Clearing Corporation (OCC) approves the application, it will still give final approval to the options transaction. Besides, it will also require the following approvals: Commodity Futures Trading Commission (CFTC).
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An options contract is a derivative that allows two parties to agree to buy or sell an asset at a specific price and within a specific time period.
As with futures contracts, institutional investors use options to hedge their positions in the spot market.
Bloomberg Senior ETF Analyst Eric Balchunas said Following this, in September approval The option for Bitcoin (BTC) ETFs is that these instruments attract more liquidity and, as a result, more “big fish.”
Adding options could generate much-needed cash flow for the Ethereum ETF, with a net flow of negative $410 million, according to research by Farside Investors. data.
