The US Securities and Exchange Commission (SEC) has given the green light for the New York meeting The Stock Exchange (NYSE) and the Chicago Options Exchange (Cboe) have listed options trading for several spot bitcoin ETFs. This development comes amid massive inflows recorded by Bitcoin ETFs in the past week.
The New York Stock Exchange and the Chicago Mercantile Exchange have received expedited approval to trade spot Bitcoin ETF options
According to filings with the Securities and Exchange Commission, the New York Stock Exchange and the Chicago Mercantile Exchange have received permission to list and trade options on several Bitcoin exchange-traded funds.
Based on a proposed rule change at the New York Stock Exchange, the US securities regulator And he allowed The exchange offers options trading for Grayscale Bitcoin Trust (GBTC), Grayscale Bitcoin Mini Trust BTC (BTC), and Bitwise Bitcoin ETF (BITB). Meanwhile, Kaboy The green light has been given To list and trade options on the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB).
Interestingly, both exchanges received “expedited approval” from the Commission meaning that authorization was granted before the expiration of the usual 30-day public comment period on the proposed amendments pursuant to Section 19(b)(2) of the Securities Exchange Act of 1934.
However, expedited approval typically occurs when the committee determines that waiting the full 30 days is not necessary for the overall protection of market stability or that there is a good reason to expedite the process as is the case with the New York Stock Exchange and the Chicago Mercantile Exchange.
Bloomberg analyst Eric Balchumas commented on this development It has been expressed Not surprisingly, though, the SEC’s decision has been applauded. Balshunas said:
They agreed to the same thing for Nasdaq recently so this wasn’t a huge surprise but it’s still good news because the SEC has been a big hurdle. We’ve heard good things about the rest of the process although the exact timeline for the listing date remains unclear.
Before the New York Stock Exchange and the Chicago Mercantile Exchange, the Securities and Exchange Commission approved Nasdaq to list and trade options on the BlackRock iShares Bitcoin Trust (IBIT). This marks the first approval for Bitcoin ETF spot options trading and came nine months after the application was filed with the Securities and Exchange Commission.
What possibilities does options trading bring to Bitcoin ETFs?
Options trading refers to buy and sell contracts that give traders the right but not the obligation to buy or sell an asset such as an ETF at a predetermined price, albeit within a specified time frame. With six of the active Bitcoin ETFs eligible for options trading, investors in these institutional funds are exposed to new trading strategies in terms of hedging against volatility or taking advantage of overnight Bitcoin price movement.
Bitwise CEO Jeff Park Sheds more light This is what he calls “free influence.” Park said:
ETF options will have cross-margin capabilities in multi-asset portfolios, which single asset exchanges like Derbit could never provide. Spot-only ETF options can leverage GLD, SPY, HYG ETFs, bonds, and mutual spread to achieve anonymous capital efficiency – the closest thing to free leverage.
Ultimately, this will increase institutional interest in the already booming Bitcoin ETF market which boasts over $65 billion in total net assets in ten months of trading.
Featured image from Forbes, chart from Tradingview