On November 16, the U.S. Commodity Futures Trading Commission (CFTC) announced its approval of a Bitcoin ETF Spot Option, marking a major development in the crypto derivatives space. According to the announcement, the responsibility for clearing the trading of these options will fall to the Options Clearing Corporation (OCC) – the sole issuer of equity options, rather than the CFTC’s Division of Clearing and Risk (DCR).
OCC approval is the final step
While CFTC approval has cleared a major hurdle, the listing of Bitcoin ETF Spot Options is still subject to the OCC’s decision. If approved, these options would expand investment channels for both individual and institutional traders looking to gain exposure to Bitcoin.
SEC and BlackRock Bitcoin ETF Approval
Previously, in September, the US Securities and Exchange Commission (SEC) approved the listing and trading of BlackRock's Bitcoin ETF Spot Option on Nasdaq, under the ticker symbol “IBIT”.
Bloomberg analyst Eric Balchunas said:
“I think other ETFs will be approved soon. This is a big win for Bitcoin ETFs, as this will attract more liquidity, which will attract the ‘big fish’ to participate.”
MicroStrategy CEO Michael Saylor also shared an optimistic forecast, saying that the move will boost Bitcoin adoption among institutional investors.
Implications for the Cryptocurrency Market
Approving a trading option for BlackRock’s iShares Bitcoin Trust is a major step forward, increasing Bitcoin’s legitimacy in the eyes of institutional investors. This brings:
Professional Risk Management and Speculation Tools: Attract new capital and increase liquidity.
Increased Investor Confidence: The involvement of the SEC and CFTC creates a solid legal foundation, encouraging demand for Bitcoin products.
Bringing Bitcoin into the Financial Mainstream: Increasing Price Stability and Promoting Market Activity.
Bitcoin Price: Volatility and Strong Recovery
As the news spread, Bitcoin price surged above $91,000, marking a strong recovery.
During Friday's trading session, BTC temporarily dropped to $87,100 following comments from the Chairman of the US Federal Reserve (Fed), Jerome Powell, about not being in a hurry to cut interest rates.
However, the price quickly recovered, breaking back above $91,000, indicating strong buying pressure from the bulls.
Conclude
The approval of the Bitcoin ETF Spot Option not only opens up new investment opportunities but also marks a major turning point in the process of legitimizing Bitcoin in the traditional financial market.
With the involvement of regulatory bodies like the SEC and CFTC, Bitcoin is getting closer to becoming a mainstream asset, bringing great opportunities for both institutional and individual investors. This event predicts a promising future for the cryptocurrency market.
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