SEC delays decision on listing and trading spot bitcoin ETF options, asks for public comments
Quick Take
- Multiple exchanges are looking to trade options on the newly approved spot bitcoin ETFs, though they have been met with delays.
- The agency asked the public on Thursday questions such as whether options on spot bitcoin ETFs should follow the same rules as stocks.
The U.S. Securities and Exchange Commission is again delaying a slew of proposals that would allow for options on spot bitcoin exchange-traded funds and asked for public input.
Multiple exchanges have since filed to allow for options trading on the newly approved spot bitcoin ETFs including Cboe Exchange, Inc., BOX Exchange LLC, MIAX International Securities Exchange LLC, Nasdaq ISE, LLC and NYSE American LLC — all of which were mentioned in the SEC's filing posted on Thursday.
Comments are due in the next 21 days and rebuttal comments in 35 days, the SEC said. The agency posed questions such as whether options on the spot bitcoin ETFs should follow the same rules as stocks.
"Whether options on the specified Bitcoin 
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ETPs should be subject to the same position limits as options on stock, and whether the available supply in the markets for bitcoin should be considered in establishing position limits for options on Bitcoin ETPs," the SEC said.
The SEC previously delayed deciding on next steps for options trading earlier this month.
Past comments
The proposals have received some comments over the past few months. Some say options trading on spot bitcoin ETFs would help investors hedge their positions and manage risk, according to the SEC's filing.
The SEC approved 11 spot bitcoin ETFs in January, which has since brought in a cumulative total net inflow of $12.38 billion, The Block previously reported.
The next "natural step" is to approve options on those products, said Grayscale CEO Michael Sonnenshein in a February comment letter.
"It stands to reason that, now that spot Bitcoin ETPs have been approved for trading on NYSE Arca pursuant to the Rule 19b-4 process, the natural next step is the approval of options on spot Bitcoin ETPs—in the same manner that options on spot gold ETPs were approved for listing and trading pursuant to the Rule 19b-4 process after spot gold ETPs were first approved for listing and trading pursuant to the Rule 19b-4 process," Sonnenshein said.
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