Good news for the cryptocurrency world! The U.S. SEC approved the listing of BlackRock's spot Bitcoin ETF options. The U.S. Securities and Exchange Commission (SEC) approved the listing and trading of $BlackRock (BLK.US)$ spot Bitcoin exchange-traded fund (ETF) options on Friday.

BlackRock's iShares Bitcoin Trust ETF $iShares Bitcoin Trust (IBIT.US)$ is the world's largest Bitcoin fund, with net assets of $22.67 billion as of September 19, 2024.

The SEC said in a statement: "IBIT options will provide investors with a hedging and risk management tool to manage the risk exposure of Bitcoin prices and Bitcoin-related products and positions."

These options will be physically settled in an American-style exercise. American-style exercise refers to an option contract that allows the holder to exercise his rights at any time before the expiration date.

The SEC said that the trading method of IBIT options will be similar to other ETF options.

"Bitcoin ETFs are a big win (as they will attract more liquidity and, in turn, more big fish)," said Eric Balchunas, senior ETF analyst at Bloomberg, on the X platform.

Balchunas added that IBIT options will also need to be approved by the U.S. Options Clearing Corporation (OCC) and the Commodity Futures Trading Commission (CFTC) before they can be officially listed. There is no "timeline" for the other two agencies, so it is uncertain when approval will be obtained. Nevertheless, the SEC's shift is still a big step forward.

Options are contracts that give investors the right, but not the obligation, to buy (call options) or sell (put options) an asset at a predetermined price before a certain date.

As Bitcoin prices are prone to large fluctuations, options can allow investors to manage the associated risks more effectively.

The U.S. crypto industry received a major boost at the beginning of this year after the SEC approved the long-awaited spot Bitcoin ETF.

Soon after, Bitcoin soared to a record high of $73,000 in March, although it has fallen back since the most recent halving on April 19, 2024.

The global crypto industry has a market value of $2.2 trillion, according to CoinMarketCap. Bitcoin hit $63,000 per coin, down 0.32% on the day. It still rose 5% this week.

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