CFTC clears path for spot Bitcoin ETF options listing

A major regulatory milestone for Bitcoin ETF options was reached on November 16 when the Commodity Futures Trading Commission (CFTC) announced that it would no longer oversee the clearing process for these options. With this development, attention has now shifted to the Options Clearing Corporation, which must finalize the listing process.

In an X post, ETF analyst Eric Balchunas wrote: 

Ball now in OCC’s court, and they are into it, so they’ll prob list very soon.

~Eric Balchunas

The CFTC’s November 16 statement clarified that the Division of Clearing and Risk (DCR) no longer oversees the clearing of these options. The Options Clearing Corporation is the only one with the mandate to clear and settle these ETF options. 

Spot Bitcoin ETF options clear key hurdles, paving the way for institutional adoption

Spot Bitcoin ETF options are traditional financial instruments that grant holders the right, but not the obligation, to buy or sell shares of crypto ETFs. These options combine the complexities of cryptocurrency market volatility with the strategic elements of options trading.

Earlier, the Securities and Exchange Commission (SEC) approved an application to list the options on the NYSE and CBOE. At the time, the regulatory body noted they were green-lighted since the SEC had recently approved the Nasdaq to list options on iShares Bitcoin Trust( IBIT), which yielded good results.

The CFTC’s recent announcement marks the second significant regulatory hurdle cleared in the process.

Market analysts view this as a significant step forward. The potential listing of spot Bitcoin ETF options is expected to attract institutional investors, helping to legitimize and expand the growing digital asset market.

Experts predict Bitcoin ETF options could arrive sooner than expected

Jeff Park, Head of Alpha Strategies at Bitwise Invest, thinks Bitcoin ETF options could soon fill the crypto market. He argued that with the CFTC’s clearance and the Options Clearing Corporation (OCC) next in line, “Bitcoin ETF options are coming sooner than you think.”

Park also mentioned that while he expects the OCC to act “very quickly,” he considers the end of 2024 as an “optimistic” target, noting that approval by year-end isn’t guaranteed.

Bitcoin commentator British Hodl told their 76,000 X followers, “Q1 is his estimated time for the option’s arrival.

Some have even suggested the start of similar spot Ethereum ETF options. One user on X, going by the name Austin, asked, “Wonder how long ETH will follow? Can they not just resubmit since it was recently denied prior to Trump winning?”

Just recently, the Securities and Exchanges Commission said it would delay the approval of spot Ethereum ETF applications to take in more public commentaries and expert advice. The commission explained that it needed to ensure the transition would be consistent with the current security laws.