The US Securities and Exchange Commission (SEC) has postponed making a choice on the New York Stock Exchange’s plan to allow trading of Bitcoin spot ETF options.
This action could significantly alter the approaches used in Bitcoin trading for investments like the Bitwise Bitcoin ETF, Grayscale Bitcoin Trust, and any other NYSE-listed trusts containing Bitcoin.
Options Trading on Bitcoin ETFs Decision
On April 8, 2024, the SEC announced that it needs more time to consider a proposed rule change enabling options trading on Bitcoin ETFs. This decision gives the regulatory body sufficient space to carefully assess the implications and details of the suggested modification.
Decision on whether or not to allow options on the spot #Bitcoin ETFs has been delayed by SEC.
— James Seyffart (@JSeyff) April 8, 2024
The SEC has set the next deadline for acting on the proposed NYSE rule change, which involves approving, denying, or delaying the application, to May 29, 2024. This timing aligns with a previous decision made regarding Nasdaq’s petition seeking approval for options trading on the Bitcoin Trust offered by BlackRock, which was also submitted last month.
Proposal and Its Background
Rule 915’s proposed revision would enable listing and trading of options based on specific Bitcoin ETFs, including Bitwise Bitcoin ETF and Grayscale Bitcoin Trust. Options represent a type of financial instrument that grants investors the chance to wager on an asset’s price trend, providing opportunities for both amplified gains and risk mitigation strategies.
Back in February 9, 2024, the SEC received the proposal and later made it open for public feedback. The SEC’s decision to extend the review period suggests a cautious approach when dealing with complex financial products related to cryptocurrencies.
Industry Reaction and Anticipation
In the worlds of finance and cryptocurrency, there’s ongoing debate about the potential for trading Bitcoin ETF options. If approved, this would represent a significant step forward in bringing digital currencies into traditional financial systems. It would mean access to valuable risk management tools and more accurate market reflections.
At the same time, in his correspondence with the SEC, Grayscale’s CEO, Michael Sonnenshein, made a case for the progression of the discussion surrounding Bitcoin SPOT ETFs, using the approval of Bitcoin futures ETFS and potential spot Bitcoin ETFS as past examples.
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2024-04-09 04:13