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US SEC Gives Go-Ahead for Spot Bitcoin Options Listings On NYSE
- The US SEC has granted “accelerated approval” for several ETFs to list and trade options linked to spot Bitcoin prices on multiple US exchanges.
- On October 18, 2024, the SEC approved NYSE American LLC’s proposal to list and trade options on three Bitcoin ETFs, Grayscale Bitcoin Trust (GBTC), Grayscale Bitcoin Mini Trust (BTC) and Bitwise Bitcoin ETF (BITB).
- Additionally, the SEC approved Cboe Exchange, Inc.’s proposal to list and trade options on two Bitcoin ETFs, Fidelity Wise Origin Bitcoin Fund and ARK 21Shares Bitcoin ETF.
The US Securities and Exchange Commission (SEC) approved applications on October 18 to list options for spot Bitcoin exchange-traded funds (ETFs) on the New York Stock Exchange (NYSE) and Chicago Board Options Exchange (CBOE). That’s a lot of parentheses but bear with me because this is important.
Related: Nasdaq Eyes Regulatory Nod for Bitcoin Index Options, Pending SEC Decision
So, what happened? The SEC accelerated its approval of Bitcoin options trading on the NYSE for 3 ETF providers, including notable funds such the Grayscale Bitcoin Trust (GBTC), Grayscale Bitcoin Mini Trust (BTC) and Bitwise Bitcoin ETF (BITB).
Additionally, last month, the SEC approved the listing and trading of options for a BlackRock ETF on the Nasdaq. Cboe Global also received approval to trade options on two spot bitcoin ETFs, the Fidelity Wise Origin Bitcoin Fund (FBTC) and ARK 21Shares Bitcoin ETF.
And why is that important? Well, there are a few reasons. First, the approval of Bitcoin ETF options means investors will consider BTC a more mature asset.
Second, the Bitcoin options market can bring new opportunities for institutional investors and ETF managers alike. This is because BTC options are more flexible and can allow higher leverage —they can amplify returns, control larger positions, use options as hedging tools, etc.
Or, just take it from the SEC itself, which wrote on the approval:
Options on the Bitcoin Funds would permit hedging, and allow for more liquidity, better price efficiency, and less volatility with respect to the underlying Funds. Further, permitting the listing of such options would enhance the transparency and efficiency of markets in these and correlated products.
SEC But, most importantly, options can inject liquidity into Bitcoin markets, as Bitwise executive Jeff Park argued. Park also noted that these options could trigger “short squeezes” where overleveraged traders are forced to buy Bitcoin to cover positions.
Market Impact
So, how’s the Bitcoin price looking? I will not lie —it’s… green.
Bitcoin is currently trading at US$69,125 (AU$102,991), an increase of 1.29% from yesterday. However, we have to look at the weekly chart to appreciate its price surge more accurately.
Related: Chainalysis Report Reveals Asia and Oceania Lead in Global Crypto Adoption
The CBOE and NYSE had initially proposed these rule changes in August 2024, aligning Bitcoin ETF options with other commodity-based ETFs.
23 October: The story was updated to indicate that the New York Stock Exchange received approval to trade options on three, not eleven, Bitcoin ETFs. Reference to approval for IBIT, and a line about two CBOE approvals was added.
Author
José Oramas
José is a journalist and translator with a keen interest in blockchain and cryptocurrencies.
