Bitcoin ETF Options Makes Important Progress After New CFTC Rules

Key Points:

• The CFTC announced it no longer oversees the clearing of spot Bitcoin ETF options, clearing a major regulatory hurdle.
• The Options Clearing Corporation must now approve and list these options, following earlier approvals from the SEC.

According to Bloomberg analyst Eric Balchunas, the Commodity Futures Trading Commission has given a critical notice that will pave the way for the listing of options on spot Bitcoin ETFs.

Read more: Bloomberg Analyst: Bitcoin ETF Options May Be Launched in Q4 

CFTC Clears Path for Spot Bitcoin ETF Options

The Bitcoin ETF options cleared a major regulatory hurdle on November 16, when the CFTC’s DCR announced it no longer has a role in overseeing the clearing of these options. With the CFTC’s approval in hand the focus now turns to the Options Clearing Corporation, which must finish up the listing process.

Spot Bitcoin ETF options are conventional options that give the holder the right, but not the obligation, to purchase or sell shares of crypto ETFs. These financial instruments put together the complexity of cryptocurrency market volatility and the nuances of options trading.

Institutional Interest Might Reform Crypto Markets

An application to list the options was approved earlier by the Securities and Exchange Commission for NYSE and CBOE. The announcement of the CFTC brings the second major regulatory hurdle that the process has overcome.

Market analysts welcome this development as a possible listing of spot Bitcoin ETF options will prove to be positive for the cryptocurrency market. The new investment avenues could attract much-needed institutional investors’ participation and further legitimize and grow the nascent digital asset market.