On Friday, the Commodity Futures Trading Commission (CFTC) announced its approval for Bitcoin spot ETF options, marking a significant development in cryptocurrency derivatives.
In its Nov. 16 statement, the CFTC clarified that its Division of Clearing and Risk (DCR) would no longer play a role in clearing these options, as the responsibility now lies solely with the Options Clearing Corporation (OCC), the exclusive issuer of equity options.
Bloomberg analyst Eric Balchunas noted that while the CFTC's approval clears a major hurdle, the actual listing of Bitcoin ETF options hinges on the OCC’s likely approval. If finalized, these options would expand investment avenues for traders and institutional players seeking exposure to Bitcoin.
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"More big fish"
BOOM: The CFTC just dropped a notice clearing the way for spot bitcoin ETF options to be listed. This is the second hurdle they needed to clear after the SEC. Ball now in OCC's court and they are into it, so they'll prob list very soon. pic.twitter.com/tRiwaPpoW4
— Eric Balchunas (@EricBalchunas) November 16, 2024
In September, the U.S. Securities and Exchange Commission (SEC) approved the listing and trading of options for asset manager BlackRock's spot Bitcoin exchange-traded fund (ETF) on the Nasdaq.
In his X reaction to the September decision, Eric Balchunas wrote: “I'm assuming others will be approved in short order. Huge win for the the bitcoin ETFs (as it will attract more liquidity which will in turn attract more big fish).”
MicroStrategy CEO Michael Saylor also shared his bullish forecast on Bitcoin amid SEC’s approval of BTC ETFs options. In his recent post on X, he wrote that this approval will lead to broader institutional adoption of Bitcoin.
The iShares Bitcoin Trust, BlackRock's ETF, will trade under the ticker symbol "IBIT." This marks a significant milestone, as it opens up new avenues for investors to trade Bitcoin-based options through a regulated financial product.
What this means for crypto market
The approval of options trading for BlackRock's iShares Bitcoin Trust marks a significant step for the crypto market, boosting Bitcoin’s legitimacy among institutional investors.
It offers sophisticated tools for risk management and speculation, likely attracting more capital and increasing market liquidity.
The SEC's involvement also enhances investor confidence, potentially driving demand for Bitcoin products. This development signals further integration of Bitcoin into the mainstream financial system, with the potential to stabilize prices and increase market activity.
Upon hearing the news, BTC bulls strapped in for the return of the rally as the Bitcoin price soared above $91,000.
Source: CoinMarketCap
Bitcoin faced a temporary dip during Friday's trading session, falling to a low of $87,100, following remarks from Federal Reserve Chair Jerome Powell, who emphasized there was "no need to rush interest rate decreases."
However, Bitcoin quickly rebounded, recovering some of its losses and climbing back above $91,000.
