The SEC approves options for the BlackRock Bitcoin ETF listed on Nasdaq

According to ChainCatcher news, as reported by Decrypt, the U.S. Securities and Exchange Commission (SEC) has approved a rule change allowing the Nasdaq International Securities Exchange to list and trade options on BlackRock's spot Bitcoin ETF (iShares Bitcoin Trust, referred to as IBIT). This decision marks a step forward in expanding the range of Bitcoin-related derivatives, providing investors with additional tools to manage exposure to the world's largest cryptocurrency.

Since regulators approved several Bitcoin-related ETFs in the U.S., BlackRock has been seeking approval for such listings at least since March of this year. The SEC's approval came after several amendments submitted by Nasdaq ISE aimed at addressing concerns about manipulation and excessive risk-taking in the emerging crypto options market.

IBIT options will be physically settled and will use American-style exercise, providing hedging services for investors looking to manage Bitcoin-related risks. Despite the approval, the SEC's actions still stem from ongoing concerns about the potential risks of cryptocurrency derivatives. Comment letters submitted during the review process highlighted worries about market volatility and the broader integration of cryptocurrencies with traditional financial markets. Some urged the SEC to delay approval until the Bitcoin market stabilizes further. In any case, the SEC found that the exchange's surveillance mechanisms, including real-time monitoring and a cross-market surveillance sharing agreement with the Chicago Mercantile Exchange, were sufficient to prevent manipulation.