Following the approval of options trading on BlackRock’s Bitcoin ETF (exchange-traded fund) on Nasdaq, it was only a matter of time until the United States Securities and Exchange Commission (SEC) authorized ETF options trading on other exchanges. On Friday, October 18, the commission permitted the New York Stock Exchange (NYSE) and Chicago Board Options Exchange (CBOE) to offer options trading for several spot Bitcoin ETFs.

Specifically, the NYSE received the green light to list and trade options for Grayscale Bitcoin Trust (GBTC), Grayscale Bitcoin Mini Trust BTC (BTC), and Bitwise Bitcoin ETF (BITB). CBOE, on the other hand, is now permitted to offer options trading on the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB).

What Does This Mean For Bitcoin ETFs?

In a recent report, QCP Capital revealed this notable development could push the growth of the US Bitcoin ETF market by enhancing liquidity. According to the trading firm, the new capacity of exchanges to list and trade options will significantly boost capital influx into the Bitcoin exchange-traded funds.

QCP wrote:

With this morning’s approval by the SEC’s approval for BTC ETF options to be listed on the NYSE, we believe this will provide the ETF with the needed liquidity to attract sustainable inflows.

ETF options will give investors the right — but not the obligation — to purchase or sell an ETF at a predetermined price and time. This investment choice allows investors to bolster their exposure to an underlying asset while helping to hedge against potential price fluctuations. 

This latest round of approval for the Bitcoin ETF options trading comes at the perfect time for the crypto products, which have been enjoying substantial attention from investors in recent weeks. According to data from SoSoValue, the US Bitcoin ETFs recorded a total weekly inflow of over $2.13 billion, the highest weekly performance since mid-March.

With the options trading about to go live on all the crypto products, the US Bitc

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Author: Opeyemi Sule