After approving options trading on BlackRock’s Bitcoin ETF (exchange-traded fund) on Nasdaq, it was only a matter of time before the U.S. Securities and Exchange Commission (SEC) allowed ETF options trading on other exchanges . The committee will take place on Friday, October 18 allowed the New York Stock Exchange (NYSE) and Chicago Board Options Exchange (CBOE) to offer options trading for several spot Bitcoin ETFs.
Specifically, the NYSE was given the green light to list and trade options for Grayscale Bitcoin Trust (GBTC), Grayscale Bitcoin Mini Trust BTC (BTC) and Bitwise Bitcoin ETF (BITB). CBOE, on the other hand, is now allowed to offer options trading on the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB).
What does this mean for Bitcoin ETFs?
In a recent report, QCP Capital revealed that this notable development could boost US Bitcoin growth ETF market by increasing liquidity. According to the trading firm, exchanges’ new capacity to list and trade options will significantly increase capital inflows into Bitcoin exchange-traded funds.
QCP wrote:
With this morning’s approval by the SEC for the listing of BTC ETF options on the NYSE, we believe this will provide the ETF with the liquidity it needs to attract sustainable inflows.
ETF options give investors the right – but not the obligation – to buy or sell an ETF at a predetermined price and time. This investment choice allows investors to increase their exposure to an underlying asset while helping to hedge against potential price movements.
This latest round of approval for Bitcoin Trading ETF options comes at the perfect time for crypto products, which have enjoyed significant investor attention in recent weeks. According to data from SoSoValue, US Bitcoin ETFs recorded total weekly inflows of over $2.13 billion, the highest weekly performance since mid-March.
With options trading on all crypto products about to go live, US Bitcoin ETFs will undoubtedly attract new investors, leading to increased demand and stronger inflows. With sustainable ETF inflows, investors would have the price of Bitcoin returns reach or exceed March levels.
Bitcoin price action
Currently, Bitcoin’s price is around $68,180, reflecting a decline of just 0.2% in the past 24 hours. However, on the weekly time frame, the value of the flagship cryptocurrency has increased by more than 8%.
According to QCP, the upcoming presidential elections in the US, investor interest in risky assets like Bitcoin could increase. “This will take the risk assets to the next level and support our Uptober story,” the company added.
The price of Bitcoin on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from Shutterstock, chart from TradingView