Bitcoin ETF Options See Progress as CBOE Files Updated Application

YEREVAN (CoinChapter.com) — The Chicago Board Options Exchange (CBOE) has taken another step in its efforts to introduce options trading on spot BTC ETFs. On August 8, Bloomberg ETF analyst James Seyffart noted there has been “definitely some movement” in this area. This comment came after CBOE withdrew its initial application and replaced it with a more detailed filing.

CBOE Submits Detailed 44-Page Filing on Bitcoin ETF Options

CBOE replaced its original 15-page filing with a 44-page document, addressing concerns like position limits and market manipulation. This updated filing suggests that the CBOE may have received feedback from the Securities and Exchange Commission (SEC). The expanded document includes more specific details, potentially moving the process forward. However, it’s unclear if this will restart the regulatory clock, which could push the final decision deadline to late April 2025.

SEC Delays Decision, Final Ruling Expected Soon

Earlier this year, the SEC delayed its decision on various applications related to Bitcoin ETF options. In March, the SEC postponed its ruling on CBOE’s initial application. In April, the SEC also deferred its decision on the NYSE American’s application to offer options trading on spot Bitcoin ETFs.

Despite these delays, some analysts expect Bitcoin ETF options could be approved later this year. The SEC’s final decision is expected around September 21. However, additional approvals from the Office of the Comptroller of the Currency (OCC) and the Commodity Futures Trading Commission (CFTC) are still required.

How Spot Bitcoin ETF Options Could Benefit Investors

Options trading on spot BTC ETFs could provide new strategies for investors. One such strategy is “covered call writing,” where an investor sells a call option on an asset they already own. This allows them to earn a premium while still holding the underlying asset. However, this strategy limits potential gains if the asset’s price increases significantly.

CBOE Global Markets’ head of derivatives, Catherine Clay, highlighted the utility of options in January. She stated,

“We believe that the utility of the options, what they provide to the end investor in terms of downside hedging, risk-defined exposures into bitcoin, really would help the end investor and the ecosystem.”

Exchange’s Re-Filing Ignites Debate on Spot BTC ETF Options

Additionally, the re-filing by CBOE has sparked discussions in the financial community. Nate Geraci, president of the ETF Store, pointed out that options are already available on some crypto derivatives ETPs. Offering them on spot ETFs follows this trend.

Moreover, Dave Nadig, financial futurist at VettaFi, also commented on the implications of this development, noting that it could attract new players to the market.

“You’re going to start seeing all sorts of hedge fund players in the space,”

“Folks who might not have been traditionally speculating on crypto directly in the crypto ecosystem are now going to have something to play with.”