Home CryptocurrencyAltcoin Nasdaq and Cboe Apply to Offer BTC ETF Options Trading and Receive Quick Response

Nasdaq and Cboe Apply to Offer BTC ETF Options Trading and Receive Quick Response

by SuperiorInvest

On January 19, the United States Securities and Exchange Commission (SEC) recognized proposals by Nasdaq and Cboe to begin trading options on Bitcoin (BTC) exchange-traded funds (ETFs).

Nasdaq requested a rule change for listing and trading options on BlackRock’s iShares Bitcoin Trust. The Cboe applied to trade options on “ETPs” [exchange-traded products] that hold Bitcoin.” Cboe launched six of the 10 BTC ETFs recently approved by the SEC.

BTC ETFs began trading on Nasdaq and Cboe on January 11 after receiving approval from the SEC a day earlier. Cboe Executive Vice President Catherine Clay told CNBC on Jan. 18 that the exchange was seeing “good inflows” into BTC ETFs, which continued to track the BTC price “as expected.”

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Clay called the options “the next logical step in the [BTC] “ETF.” He said BTC ETF options trading would add utility and risk mitigation to the products. Nasdaq said in its filing that the options would offer “cost efficiencies and greater hedging strategies.”

Options are a derivative that allows the holder to buy or sell an asset at a predetermined price at a predetermined time. VettaFi analyst Dave Nadig told CNBC on January 17:

“I think we’re going to start seeing all kinds of hedge fund players in the market. [BTC ETF options] space. “People who haven’t traditionally been speculating cryptocurrencies directly in the crypto ecosystem will now have something to play with.”

Cboe applied for permission to list options “last week,” Clay said, and “we’re really in this holding pattern to see what regulators will do with our filing and also other exchanges’ filings. […] “It’s really hard to know if we will even see approval.”

Cboe’s options clearing corporation had to file similar filings with the SEC and the Commodity Futures Trading Commission, Clay added.

Bloomberg ETF analyst James Seyffart commented on the unusual speed of the Nasdaq announcement. Options trading approval is likely to come before the end of February or around September 21 at the latest.

Proposals will be open to comment for 21 days after publication in the Federal Register.

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