- Nasdaq is pursuing regulatory approval to launch options on a Bitcoin index, enhancing institutional access to Bitcoin exposure.
- BlackRock’s spot Bitcoin ETF recorded its largest daily inflow in 35 days, indicating strong investor interest despite market volatility.
- The SEC has yet to approve options tied to spot Bitcoin ETFs, including Nasdaq’s application for BlackRock’s iShares Bitcoin Trust.
Nasdaq, the prominent American stock exchange operator, has applied for regulatory approval to launch and trade options on a Bitcoin index. This move aims to offer institutional investors and traders a new avenue for hedging their Bitcoin exposure, providing greater flexibility in managing their portfolios.
Regulatory Approval Sought for Bitcoin Index Options
On August 27, Nasdaq announced its intention to introduce index options based on a Bitcoin index. These options would give institutions and traders a diversified method to hedge against potential Bitcoin price fluctuations. The proposed options will rely on the CME CF Bitcoin Real-Time Index, a benchmark developed by CF Benchmarks that tracks Bitcoin futures and options contracts on the CME Group’s exchange.
Importance of Bitcoin Options for Institutional Investors
According to Bitwise’s Chief Investment Officer, Matt Hougan, the availability of options for Bitcoin is crucial for the asset class to achieve full normalization. Hougan emphasized the importance of filling the liquidity picture for Bitcoin, which would be significantly enhanced by introducing exchange-traded fund (ETF) options. These options would allow investors to manage their exposure to Bitcoin more effectively, especially in a volatile market.
BlackRock’s Spot Bitcoin ETF Sees Record Inflows
This announcement coincides with a significant inflow into BlackRock’s spot Bitcoin ETF, the iShares Bitcoin Trust (IBIT). On August 26, IBIT experienced a net inflow of $224.1 million, marking its largest daily inflow in over a month. This surge in investment suggests that investors are capitalizing on a slight dip in Bitcoin’s price following a recent rally. The strong inflow into IBIT contributed to a combined $202.6 million daily net inflow across the 11 U.S. spot Bitcoin ETFs.
SEC Approval Pending for Bitcoin-Related Options
However, despite the growing interest, the United States Securities and Exchange Commission (SEC) has yet to approve options based on individual exchange-traded funds tied to spot Bitcoin prices. This includes Nasdaq’s application to trade options on BlackRock’s iShares Bitcoin Trust ETF. The lack of approval remains a significant hurdle, with many investors eagerly awaiting the SEC’s decision.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
