New York, Tuesday, September 24, 2024-The US Securities and Exchange Commission (SEC) has approved Nasdaq’s International Securities Exchange (ISE) to list and trade options on BlackRock’s iShares Bitcoin Trust (IBIT).
This significant move follows months of review and signals growing acceptance of Bitcoin derivatives in the financial sector.
BlackRock initially submitted the proposal in March 2024, and the approval marks a key development in the U.S. cryptocurrency landscape.
Jeff Park, Head of Alpha Strategies at Bitwise, called the decision “game-changing” for Bitcoin exposure through traditional financial products.
The IBIT options provide institutional investors and traders a safer and more cost-effective means of managing their exposure to Bitcoin. Instead of directly buying Bitcoin, these derivatives offer an alternative to engage with the cryptocurrency market, further integrating Bitcoin into mainstream financial instruments.
To receive SEC approval, Nasdaq ISE implemented amendments to address concerns over market manipulation and excessive risk. The exchange limited IBIT options to 25,000 contracts, which it described as a “conservative” approach given the market size and liquidity of the iShares Bitcoin Trust.
The SEC also confirmed that its surveillance protocols, including real-time monitoring and partnerships with the Chicago Mercantile Exchange, would be employed to prevent market manipulation.
Although concerns about Bitcoin ETFs remain, including volatility risks and the integration of digital assets into traditional markets, the approval is expected to push Bitcoin ETFs further into mainstream financial practices. The SEC’s move reinforces Bitcoin’s legitimacy in the world of institutional investing.
