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SEC Defers Ruling On Spot BTC ETF Options Trading

SEC Defers Ruling On Spot BTC ETF Options Trading

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The United States Securities and Exchange Commission has delayed its decision on approving options trading on spot Bitcoin ETF. 

Options trading on spot Bitcoin ETFs could open the door for more institutional capital into Bitcoin. 

SEC Delays Decision

The United States Securities and Exchange Commission has postponed its decision to approve options trading on spot Bitcoin ETFs. In a March 6 filing, the SEC extended the time to respond to Cboe Exchange and the Miami International Securities Exchange on their bids to offer options trading on Bitcoin ETFs. 

“Cboe Options’ current rules generally permit it to list options on an ETP three days after shares of the ETP begin trading on a national securities exchange. However, those rules do not apply to ETPs holding commodities such as Bitcoin.”

The SEC also delayed its decision on Nasdaq’s bid to offer options on BlackRock’s iShares Bitcoin Trust (IBIT). In its reasoning, the SEC stated that the delay would give it adequate time to consider the request. 

“The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change.”

Expected Delay? 

The exchanges had filed to list Bitcoin ETF options on January 25, with the first decision deadline coming on March 10. This is because, under US securities laws, the SEC has 45 days to decide or differ on the matter. The delay gives the Securities and Exchange Commission an additional 45 days to come to a decision. 

Calls For Approval 

Options give traders leverage, allowing them to make directional bets on the market. Grayscale CEO Michael Sonnenshein urged the SEC to approve options for Bitcoin ETFs, adding that they contributed to a robust and healthy market. 

“As we look ahead, I think it’s never been more important for the #crypto and ETF communities alike to advocate for the development of a robust listed options market for spot #bitcoin ETFs. Although $GBTC has been in the public market since 2015, it was never accompanied by listed options, as they aren’t a feature of the OTC Market.”

VettaFi analyst Dave Nadig stated that once Bitcoin ETF options markets get the green light, an influx of hedge fund players will enter the space. 

Bitcoin ETFs A Roaring Success 

The Securities and Exchange Commission approved spot Bitcoin ETFs on January 11, the final day it had to decide after months of delay. Since then, traders have funneled their funds into the ETFs, with billions coming into them. The SEC is now deciding on seven spot Ether ETFs. Many analysts have predicted that the SEC will hold back until May 23 and will approve all seven applications in one go on the deadline for VanEck’s application.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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