NYSE, Nasdaq ISE Withdraw Proposals for Bitcoin, Ether ETF Options

As a seasoned crypto investor with over a decade of experience navigating the ever-evolving digital asset landscape, I find myself both encouraged and perplexed by the latest developments regarding Bitcoin and Ethereum ETF options on the NYSE and Nasdaq International Securities Exchanges.


More recently, the American and Nasdaq International Securities Exchanges, branches of the New York Stock Exchange, have retracted several suggestions for changes in their rules concerning the listing of options on Bitcoin and Ether, specifically for Bitcoin-based exchange-traded funds (ETFs) and Ether ETFs.

As a seasoned investor with over two decades of experience in the financial markets, I have witnessed numerous regulatory filings and market developments that shape the investment landscape. The recent withdrawals recorded in regulatory filings regarding spot Bitcoin and Ethereum ETF options on August 14 and 15 are yet another example of the ongoing discussions and actions surrounding these digital assets in the US. While it’s challenging to predict the exact outcome, my personal experience has taught me that staying informed and attentive to regulatory changes is crucial for navigating the dynamic world of cryptocurrency investments.

As a crypto investor, I recently learned that my preferred exchange has put on hold their proposals for enabling options trading on the Bitwise Bitcoin ETF, Grayscale Bitcoin Trust (BTC), and other trusts holding both Bitcoin and Ether. These proposals aimed to broaden the array of investment instruments accessible to us investors.

In a similar vein, Nasdaq ISE withdrew plans for listing and trading Bitcoin and Ether trust option contracts. This move comes after previous attempts by Nasdaq to introduce cryptocurrency-based options products.

After facing increased examination and ongoing evaluations by the Securities and Exchange Commission (SEC), withdrawals of certain actions have been made. Given the intricacy of regulating Bitcoin assets, the SEC chose to proceed with caution when requesting more time to analyze the suggested amendments they had asked for in July.

On August 13th, NYSE Arca decided to withdraw its proposal for a rule modification that would have allowed for cryptocurrency ETF options. This action appears to be in line with a larger pattern, as exchanges seem to be adapting their tactics due to regulatory input and changing market circumstances.

James Seyffart, an analyst at Bloomberg Intelligence, proposes that these withdrawals could be a sign of growing optimism towards obtaining regulatory clearance for Exchange-Traded Funds (ETFs) related to cryptocurrencies. This positive movement might be influenced by feedback from the Securities and Exchange Commission (SEC).

Currently, American investors have the freedom to trade option contracts tied to Bitcoin’s performance via derivatives linked to ETFs, yet they do not have the option to trade options on ETFs that physically own Bitcoin.

The leading crypto investment fund, Grayscale (managing approximately $25 billion in assets), is pushing for a regulatory revision to make it possible for options trading on Bitcoin Spot Exchange-Traded Funds (ETFs). Grayscale believes that if options on derivative investments are allowed, then options on ETFs holding the real asset should also be considered permissible.

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2024-08-16 21:54