Bitcoin ETF Options Trading Now Approved By The SEC

Key Points:

• The U.S. SEC has granted accelerated approval for Bitcoin ETF options trading on the NYSE and Cboe.
• Approved funds include the Fidelity Wise Origin Bitcoin Fund, ARK21Shares Bitcoin ETF, and Grayscale Bitcoin Trust, which allow institutional investors to hedge or amplify their exposure to Bitcoin.

The U.S. Securities and Exchange Commission has given the green light for 11 ETFs to list and trade options on NYSE and Cboe Exchange linked to the spot price of Bitcoin.

Read more: CryptoQuant Bitcoin Analysis Sees ETF Options Impacting Bitcoin Demand

SEC Greenlights Bitcoin ETF Options

Included were the popular ones such as Fidelity Wise Origin Bitcoin Fund, ARK21Shares Bitcoin ETF, Invesco Galaxy Bitcoin ETF, Grayscale Bitcoin Trust, and iShares Bitcoin Trust ETF. For the first time, these ETFs have been approved en masse in January 2024, opening the floodgate for institutional investors to seek exposure to Bitcoin via some type of regulated financial product.

In their entirety, the newly approved Bitcoin ETF options contracts will give investors the opportunities to hedge positions in Bitcoin or increase exposure to the leading cryptocurrency’s price movements.

Therefore, the amendment to the rule by SEC will make possible the regulations of such Bitcoin ETFs much like commodity-backed ETPs in products holding gold and silver. This will ensure that Bitcoin options fall within the current regulations for commodity-based financial products and that there is a better avenue of protection for investors.

Stricter Regulations and Surveillance for Bitcoin ETFs

In addition to that, the NYSE, along with its subsidiary NYSE Arca, will team up with the CME, the prominent futures exchange, to conduct surveillance of trading. They will mutually share information concerning surveillance so that no potential manipulation in the market takes place.

The SEC set strict positions and exercise limits on these Bitcoin ETF options as well, further indicating how conservative and safe they are meant to be in the first place for institutional investors.

The greenlight is part of the broader effort by the SEC to actually expand access to crypto-based financial products. As such, in 2024 alone, spot ETFs for Bitcoin and Ether have been approved, further integrating cryptocurrencies into mainstream finance.

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