The SEC has postponed Bitcoin ETF options trading for further review.

Key points:

• The US SEC has postponed its decision to allow Bitcoin ETF options trading on the NYSE.
• The delay is aimed at giving the SEC more time to thoroughly consider the proposed rule changes, with a new decision date set for May 29, 2024.
• Despite the approval of the Bitcoin futures ETF, the fate of the options trading ETF remains uncertain.

The U.S. Securities and Exchange Commission (SEC) has extended the timeline for a decision regarding the possible introduction of options trading for the New York Stock Exchange (NYSE)’s spot Bitcoin exchange-traded fund (ETF).

Read more: Spot Ethereum ETF vs. Spot Bitcoin ​ETF: Investments Poised to Explode in the Future

SEC Delays Decision on Bitcoin ETF Options Trading

The delay, disclosed in an April 8 filing, affects proposals from Bitwise and Grayscale, which hold Bitcoin.

The postponement affects options trading on the Bitwise Bitcoin ETF (BITB), Grayscale Bitcoin Trust (GBTC), and other Bitcoin holding trusts on the NYSE. The SEC noted that it needs more time to thoroughly review the proposed rule changes, with a new decision date set for May 29, 2024.

The proposal seeks to amend Rule 915 to allow certain Bitcoin ETF options, allowing investors to speculate on price movements and use a variety of strategies such as leverage and hedging. However, the SEC’s cautious approach to integrating Bitcoin-related products into traditional financial markets is evident in its decision to extend the evaluation period.

Advocates seek approval amid uncertainty

Bitcoin ETF options trading has been a widely discussed topic, with proponents claiming it will increase market liquidity and provide additional investment alternatives. Grayscale CEO Michael Sonnenshein supported the move, arguing its potential to strengthen market health.

Despite the Commodity Futures Trading Commission (CFTC) approving and listing a Bitcoin futures ETF on the NYSE, the fate of the options trading ETF remains uncertain. Sonnenshein argues that there is no reason to withhold approval for Bitcoin ETF options since the SEC has already approved a Bitcoin futures ETF and registered a Bitcoin ETF on the NYSE.

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