US SEC Delays Decision on Grayscale, Bitwise Bitcoin ETF Options

The U.S. Securities and Exchange Commission (SEC) has postponed its decision on allowing options trading for Bitcoin exchange-traded funds (ETFs) offered by Grayscale and Bitwise.

According to the SEC’s latest filing on April 8, the Commission has decided to allocate a longer period to review Grayscale’s and Bitwise’s applications to list the trading of their Bitcoin ETF options.

SEC Designates May 29 as New Decision Date

“The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change,” the filing reads.

Under Section 19(b)(2) of the Act, the SEC has set May 29, 2024, as the deadline by which it will either approve or disapprove, or initiate proceedings to decide whether to disapprove, the applications.

On Jan. 10, a total of 11 Bitcoin ETFs were approved as the first batch of its kind, listed on the New York Stock Exchange (NYSE) and Nasdaq. These financial products enhanced the accessibility of cryptocurrency for the public, providing new investment options.

Deferred Applications Filed by Cboe and Nasdaq

The SEC first postponed its decision on allowing options trading for Bitcoin ETFs in March 2024. The delay affected proposals from both Cboe Exchange Inc. and Nasdaq ISE, which sought to offer options linked to ETFs holding Bitcoin and BlackRock’s iShares Bitcoin Trust, respectively.

Details of these postponements were documented in the SEC’s announcements, demonstrating the regulator’s cautious approach to overseeing the expansion of crypto-related products.

These proposals aimed to introduce derivatives that traders could use to speculate on future gains or to protect against potential losses.

By paying a premium, an investor can enter into a contract with another party, typically facilitated by an exchange, that sets a future date at which the investor has the right, but not the obligation, to buy a specific asset, such spot Bitcoin ETFs, at a predetermined price regardless of the market price at that time.