SEC Approves Bitcoin ETF Options But What Does it Mean For BTC?

The US Securities and Exchange Commission (SEC) has approved changes to stock exchange rules that allow for the listing of options linked to Bitcoin ETFs.

NYSE will now be able to offer options on Grayscale Bitcoin Trust (GBTC), Grayscale Bitcoin Mini Trust (BTC), and Bitwise Bitcoin ETF (BITB), while Cboe Global Markets can list options on the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB).

In total, the regulator granted "accelerated approval" to 11 ETFs to list options to spot Bitcoin prices.

Last month, the SEC granted approval to Nasdaq ISE to list and trade options on BlackRock’s iShares Bitcoin Trust (IBIT) after the exchange withdrew the application one month prior.

Bitcoin ETF Options Applications Withdrawn By New York Stock Exchanges

Both the NYSE and NASDAQ have withdrawn their Bitcoin ETFs options applications involving Bitwise, Grayscale, and others

BlockheadBlockhead

The SEC said these options "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."

Last week, Grayscale filed with the SEC to convert its Digital Large Cap Fund into an ETF. The fund currently manages over $520 million in assets, offering exposure to a basket of five cryptocurrencies, including Bitcoin, Ethereum, Solana, Ripple, and Avalanche, weighted at 75.58%, 17.83%, 4.16%, 1.76%, and 0.66% respectively.

Grayscale’s Multi-Crypto Fund Seeks ETF Conversion

While Bitcoin and Ethereum remain the dominant assets for asset managers due to the availability of exchange-traded funds (ETFs), the firm is ramping up efforts to expand its product offerings to include a multi-crypto ETF.

BlockheadBlockhead

BRN analyst, Valentin Fournier, believes that this approval is good news for Bitcoin bulls.

"The approval of options on a Bitcoin ETF could significantly impact Bitcoin’s price," he stated. "First, it will provide analysts with valuable data to better gauge institutional demand and market activity. Second, it will enhance the appeal and utility of Bitcoin ETFs by broadening investment strategies. Lastly, the additional liquidity introduced by options trading could help stabilize Bitcoin’s volatility over time."

For full access to brn insights, register your interest here.