Buoyed by the launch of several Ethereum spot ETFs at the end of July, the Nasdaq Exchange has decided to partner with asset manager BlackRock to ask the Securities and Exchange Commission (SEC) to open options trading on these ETFs. For both partners, this would democratize investment around this cryptocurrency.
SEC to rule in favor of options trading on Ethereum spot ETFs Hand in hand, asset manager BlackRock and the Nasdaq Exchange have embarked on a new venture that could bring something more to the cryptocurrency market.
This August 6, 2024, The two partners have filed an application with the Securities and Exchange Commission (SEC) to allow trading of options on the Ethereum spot ETF proposed by BlackRock . As Nasdaq states in its filing with the SEC:
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The Stock Exchange [Nasdaq] propose to amend the criteria relating to the underlying securities, in order to permit the listing and trading of options on the iShares Ethereum Trust (Trust) as a unit deemed appropriate for options trading.”
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If this application were to be approved by the SEC, Investors will be able to buy or sell BlackRock's Ethereum Spot ETF at a fixed price for a specified period of time through trading options. This prevents its price from fluctuating, giving investors time to think before making their decision.
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Generally, Traders use these options to protect themselves against potential losses on their investments or to speculate on the future price of an asset. . Options offer some flexibility because investors can choose whether or not to execute the trade, unlike futures contracts.
Options trading would increase accessibility of cryptocurrency investments For Nasdaq and BlackRock, This initiative aims to expand the range of investment tools for Ethereum and make cryptocurrencies more accessible in traditional financial markets. The second largest stock market in the United States provided more details in its filing:
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While shares are not the exact equivalent of a direct investment in ether, they offer investors an alternative method of gaining exposure to […] ether through the public securities market, which may be more familiar to them “.
The request initiated by the two partners comes just two weeks after SEC Approves 9 Ethereum Spot ETFs on American soil.
To compare, The SEC has yet to approve options trading for the spot Bitcoin ETFs that launched earlier this year .
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The regulator will now examine this proposal, a final decision is expected no later than April 9, 2025 The application will also need to be reviewed by the Office of the Comptroller of the Currency and the Commodity Futures Trading Commission for approval.
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Source: Reuters
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Surprised by the rise of crypto-assets in the late 2010s, I started to closely follow this sector that fascinates me to the highest degree. When I am not in football stadiums, rugby or handball halls, I work on writing relevant articles about cryptocurrencies and more broadly, Web3.
Zacharie Tazrout
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