Bitrabo Editorial
A transformation is looming on the horizon with the concept of ‘financialization’ of Bitcoin by introducing options on spot Bitcoin exchange-traded funds (ETFs). This shift could usher in a new chapter for Bitcoin, bringing it closer to the operational norms of traditional financial markets.
Anticipated Arrival of Spot Bitcoin ETF Options
Recent developments indicate significant progress towards the approval of spot Bitcoin ETF Options. Major players in the market such as NASDAQ, NYSE, and CBOE have withdrawn their initial filings. However, CBOE subsequently submitted a more detailed application, with NASDAQ and NYSE expected to do the same in the near future.
According to James Seyffart, a Bloomberg ETF analyst, there is a likelihood of these exchanges re-filing their applications for options trading on Bitcoin ETFs following CBOE’s lead. The expanded 44-page application from CBOE suggests a response to SEC feedback concerning issues like position limits and market manipulation risks.
This re-submission indicates a reset in the evaluation process, with a potential new deadline around April 25, subject to SEC engagement depth and flexibility. Despite uncertainties, Seyffart anticipates progress depending on the SEC’s involvement.
Embracing the Financial Aspect of Bitcoin
Kelly Greer, Vice President of Trading at Galaxy Digital, views the inclusion of Bitcoin ETF options as a pivotal moment for the market. Greer highlighted the importance of derivatives in market functionality, stressing that Bitcoin and digital assets have room to grow compared to traditional markets.
Greer pointed out the current disparities in the derivatives market size, emphasizing the value of options in functional markets. She highlighted the challenges limiting market access, particularly affecting US retail investors due to regulatory constraints.
Greer emphasized the strategic significance of the US financial market, asserting that listing options on ETFs in this market would enhance liquidity and efficiency for Bitcoin market players.
Referencing insights from Meltem Demirors and Kaledora Fontana Kiernan-Linn on financialization, Greer echoed the importance of this concept for market growth. Demirors highlighted how financialization played a crucial role in the oil industry’s development and would similarly benefit new digital commodities like BTC.
At the time of writing, BTC was trading at $58,451.