The U.S. Securities and Exchange Commission (SEC) has given the Nasdaq exchange the go-ahead to list and trade options for BlackRock’s spot Bitcoin exchange-traded fund (ETF).
As per a Friday filing, the SEC stated that it was greenlighting BlackRock on an “accelerated basis” to list those options for the iShares Bitcoin Trust (IBIT).
“8+ months after spot Bitcoin ETFs launched… Options trading has now been approved,” noted ETF Store President Nate Geraci in an X post. “Better late than never.”
The top Wall Street regulator OK’d nearly a dozen spot Bitcoin ETFs in January, including from companies like BlackRock, Fidelity, and Grayscale Investments.
With IBIT options greenlighted, traditional investors now have a new avenue to trade BTC-based options via a regulated financial product. These physically settled options will function like other exchange-traded fund options already traded on United States exchanges.
The SEC indicated that IBIT options will undergo rigorous surveillance and oversight, following ETF trading rules with added Bitcoin-specific standards.
More Approvals Forthcoming?
Bloomberg’s senior ETF analyst, Eric Balchunas, expects the SEC to sign off on more Bitcoin ETF options from other issuers “in short order.” The move will attract “more liquidity, which will in turn attract more big fish,” he observed.
But Balchunas emphasized that other regulators must approve the proposals, signaling the actual listing will take longer.
“This is just one stage of approval; the OCC [Office of the Comptroller of the Currency] and CFTC [Commodity Futures Trading Commission] have to approve as well before they officially list,” Balchunas opined. “The other two don’t have a ‘clock’ so not sure when they’ll be approved. A big step tho, nonetheless, that the SEC came around.”
What Does This Mean For Crypto?
For Michael Saylor, the CEO of the world’s largest corporate BTC holder MicroStrategy, the approval of trading and listing of options for BlackRock’s iShares Bitcoin Trust will result in broader institutional adoption of Bitcoin.
The approval of options for $IBIT will accelerate institutional #Bitcoin adoption. https://t.co/BontWrHhOt
— Michael Saylor (@saylor) September 20, 2024
Overall, the approval marks a watershed moment for the crypto sphere, indicating further integration of Bitcoin into the mainstream financial system.
The options provide a new tool for hedging and managing risk connected to the price of the premier cryptocurrency. This could possibly help draw in fresh capital and boost market liquidity. The involvement of the U.S.’s top financial cop, the SEC, also strengthens investor confidence, which could significantly increase demand for BTC products and stabilize prices.
Bitcoin was changing hands for $63,202 at press time, marking a 0.5% surge over the last 24 hours. According to CoinGecko data, the cryptocurrency’s value has surged by approximately 5.7% over the past week.
