SEC Greenlights Nasdaq’s Request on Crypto ETF Options Limits
The Securities and Exchange Commission has enabled a Nasdaq rule change that removes position limits for options on spot Bitcoin and Ether ETFs. The US exchange’s filing, aimed at aligning these products with other commodity-based fund options, became effective this Wednesday.
Submitted on January 7, the proposal eliminates the existing cap of 25,000 contracts for options tied to a selection of Bitcoin and Ether ETFs. Affected products are issued by firms like BlackRock, Fidelity, Bitwise, Grayscale, ARK/21Shares, and VanEck on the Nasdaq platform.
Although the SEC waived the customary 30-day waiting period for immediate effect, it can still suspend the rule within 60 days if it decides a more comprehensive review is warranted.
Options are contracts giving traders the right to buy or sell a specific asset at an agreed price before expiration. Limits on these positions are typically enforced to lessen the risk of extreme speculation, attempts at market manipulation, and overly large positions that could increase volatility.
Nasdaq stated the amendment permits it to handle these options in the same manner as all others eligible for listing. The exchange contends this ends a differential treatment while preserving necessary investor protections.
