CFTC Issues Advisory to Clear Options on Spot Commodity ETFs Opening Door to Approval of #Bitcoin Options – Huge Liquidity Injection
- Barbara StreisandOriginal
- 2024-11-17 15:04:16552browse
Options contracts give investors the right, but not the obligation, to buy or sell an underlying asset at a specified price before a set date.
The U.S. Commodity Futures Trading Commission has announced that it will no longer be involved in clearing Bitcoin exchange-traded fund (ETF) options, a role that will now be taken on by the Options Clearing Corporation (OCC).
According to a statement issued by the Commodity Futures Trading Commission’s Division of Clearing and Risk, the agency will no longer be involved in clearing Bitcoin ETF options.
The Options Clearing Corporation, which serves as the “sole issuer of all equity options” in the U.S., will now hold the final authority to decide whether these options will be listed.
The SEC last month approved applications from the New York Stock Exchange and the Chicago Board Options Exchange to list and trade Bitcoin ETF options, a move that was widely anticipated by market participants.
Options contracts give investors the right, but not the obligation, to buy or sell an underlying asset at a specified price before a set date.
The SEC said that options trading could bring “better price efficiency” and “less volatility” to Bitcoin ETFs, helping to stabilize the market while making it more transparent and efficient overall.
Bitcoin proponents have hailed the approval of Bitcoin ETF options as a game-changer, bringing more liquidity to the market.
In a tweet, an observer noted the development and highlighted its potential impact on liquidity.
CFTC issues advisory to clear options on Spot Commodity ETFs opening door to approval of #Bitcoin options – huge liquidity injection. https://t.co/Nm8CPgs5pz pic.twitter.com/RWhU5Yctam
Earlier this year, Grayscale CEO Michael Sonnenshein called for the swift approval of Bitcoin ETF options, saying that these offerings could pull in more parties, such as broker-dealers, and deepen Bitcoin’s ties with traditional finance.
Crypto influencer Mario Nawfal, in a recent social media post, highlighted the buzz around Bitcoin ETF options, saying institutional investors are “drooling” over the opportunities.
BITCOIN SPOT ETF OPTIONS GET THE GREEN LIGHT
The CFTC approved Bitcoin spot ETF options, and institutional investors are drooling.
⁰BlackRock’s Bitcoin ETF will trade as “IBIT,” and everyone’s hyped about more “big fish” jumping in.
BTC spiked to $91,000 after a dip to $87,100… pic.twitter.com/qJCtH7hJpm
“This is your mainstream finance world, now featuring Bitcoin,” he wrote.
Bitcoin reacted positively to the development, breaking past the $91,000 resistance level it struggled with over the past two days. At press time, the flagship cryptocurrency was trading at $91,293, up 2.4%.
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