SEC Advances Nasdaq’s Request for Bitcoin ETF Options, Opening New Avenues for Investors

SEC Advances Nasdaq’s Request for Bitcoin ETF Options, Opening New Avenues for Investors

In a significant move, the Securities and Exchange Commission (SEC) has given the green light to Nasdaq’s request to introduce options trading for spot Bitcoin ETFs, marking a potential expansion in investment opportunities. The approval allows multiple “non-security commodity” funds to list on U.S. exchanges.

Nasdaq initiated the process by submitting 19b-4 filings with the SEC, seeking to amend listing rules to enable the trading of derivatives on ETFs backed by Bitcoin (BTC). The SEC has now acknowledged these filings, initiating a 21-day period for public comments and feedback. ETF expert James Seyffart suggests that a decision from the SEC could be expected by the end of February, although there is a possibility of a delay until September.

Traditionally, the SEC has not been known for swift responses to such requests, Seyffart highlighted. The introduction of options on spot BTC ETFs could offer investors an additional avenue to gain exposure to Bitcoin. These derivatives provide traders with opportunities to speculate or hedge against the inherent volatility associated with cryptocurrencies and other risk assets.

If approved, options trading would join a growing array of Bitcoin-related products entering the market following the approval of spot BTC ETFs. Financial products provider Direxion has already filed for five leveraged spot Bitcoin ETFs, adding to the expanding landscape of cryptocurrency investment offerings.

Beyond U.S. borders, interest in crypto ETFs is on the rise. Hong Kong regulators and institutions are gearing up to launch similar products in the first quarter of this year. While regulators in Singapore and South Korea have expressed caution regarding spot BTC funds, there are indications that officials may reconsider their stance in response to the growing demand for BTC-related investment vehicles. In South Korea, the presidential office has urged local regulatory agencies to review their crypto stance, reflecting the increasing interest in Bitcoin-related investment opportunities.

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