On October 18, the SEC approved listing options for spot Bitcoin ETFs on the NYSE and CBOE. This marks a major development in the cryptocurrency market.
The U.S. Securities and Exchange Commission (SEC) made a significant stride on October 18 by authorizing the listing of options for spot Bitcoin exchange-traded funds (ETFs) on the New York Stock Exchange (NYSE) and Chicago Board Options Exchange (CBOE).
Approvals for the Expansion of Bitcoin ETF Options
This approval is per the SEC’s prior endorsements of funds, including the ARK21Shares Bitcoin ETF and the Fidelity Wise Origin Bitcoin Fund. BlackRock’s iShares Bitcoin Trust ETF is one of the eleven most recent ETFs to be approved. This development is considered a significant opportunity for institutional traders and investors.
The recently authorized options offer investors more cost-effective and flexible methods to manage risks and increase their Bitcoin exposure. The SEC stated that these options would increase liquidity, improve price efficiency, and decrease volatility. Additionally, the objective is to enhance market transparency.
Jeff Park, a manager at Bitwise, stated that these options would potentially encourage some investors to purchase Bitcoin and introduce liquidity to Bitcoin markets. He stated that options have the potential to increase market liquidity and may convince short-position traders to acquire Bitcoin.
Benefits for Institutional Investors
Bitcoin’s value has experienced an increase after this approval. The price of Bitcoin increased by 1.29% to $69,125 following the news of the approval.
The CBOE had initially proposed this rule change in August 2024, and the SEC’s sanction has been extended to all listed ETFs except the Grayscale Bitcoin Mini Trust.
In summary, the maturation of the cryptocurrency market and its broader acceptability are facilitated by the approval of Bitcoin ETF options. It introduces new investment instruments to the market, thereby creating more opportunities for institutional investors.
