Nasdaq to Launch Spot Bitcoin Options: A Game Changer for Crypto Investments

• Nasdaq has filed an application with the US Securities and Exchange Commission (SEC) to launch a Bitcoin Index Options (XBTX). 

• According to Bloomberg analyst James Seyffart, the first approval could be witnessed in the 4th quarter of the year. 

The crypto market has received a major boost as Nasdaq announced its application with the Securities and Exchange Commission for the launch of Nasdaq Bitcoin Index Options (XBTX).

According to reports, this initiative was executed in partnership with the creator of CME CF Bitcoin Real-Time Index (BRTI), CF Benchmarks. This is expected to be a current trade on crypto exchanges as well as spot options to complement the CME options linked to Bitcoin futures. 

Commenting on this, Sui Chung, CEO of CF Benchmark, explained that these regulated derivatives would improve investors’ confidence and largely contribute to the growth of the broad market. 

Spot options settling to BRRNY (CME CF Bitcoin Reference Rate – New York Variant) will build upon the hugely successful BTC futures and options contracts offered by CME. Together these regulated crypto derivatives will give investors the confidence to deploy more nuanced ways to gain exposure to the largest digital asset and will complement the spot ETFs that have already proved so popular with investors.

Multiple reports also confirm that several applications have been filed in relation to options linked to the Spot Bitcoin ETFs. However, four applications were withdrawn recently by Cboe, NYSE, Nasdaq and BOX. 

Bloomberg Analyst Speaks on the Spot Bitcoin Options

According to Bloomberg analyst James Seyffart, the filing and approval could occur in the fourth quarter of this year. The deadline for the SEC to make a decision is September 21. 

IDK if I jinxed it or what. But three exchanges have withdrawn their applications to list the spot Bitcoin ETF options since I tweeted this. Not gonna read much into it for now. The exchange filings that matter IMO are the ones that list the ETFs — Nasdaq, NYSE, & CBOE.

Options are exchange-traded derivatives that enable holders to buy or sell an asset at a set price until a set date. The advantage is that traders capitalize on a low-cost opportunity to increase their buying power. For institutional investors, this could be an important hedge against inflation. 

While waiting for the SEC’s decision, investors have resorted to other products, such as Bitcoin-linked ETFs and options on those funds. According to Bitwise’s chief investment officer, Matt Hougan, the market is currently missing the liquidity picture that the options could provide. 

It’s important that options on bitcoin are available for this asset class to be fully normalized. We’re missing part of the liquidity picture that ETF options would provide.

Bitcoin (BTC) is expected to react positively to the potential SEC’s approval as investors await a stronger price-determining factor to force a bullish reversal. 

At press time, BTC was trading at $59.9k after declining by 5% in the last 24 hours and 13% in the last 30 days. According to our data, Bitcoin’s trading volume is currently up by 58%, with $44.5 billion changing hands. 

As we formerly highlighted, this, coupled with Bitcoin’s popularity in Singapore, is believed to trigger a bullish reversal in the near term.