SEC Postpones Decision on Whether to Allow Exchange to List Options Tied to Spot Ether (ETH) ETFs

The United States Securities and Exchange Commission (SEC) has once again postponed ruling on whether an exchange can list options tied to spot Ether (ETH) exchange-traded funds (ETFs)

The United States Securities and Exchange Commission (SEC) has once again postponed ruling on whether an exchange can list options tied to spot Ether ETH $2,443.33 exchange-traded funds (ETFs), according to an Oct. 11 filing.

The SEC has delayed deciding on a proposed rule change permitting Cboe Exchange to list options tied to several popular spot ETH funds, the filing said.

The deadline for a ruling from the agency has been pushed back from Oct. 19 to Dec. 3, according to the filing.

The SEC cleared options on iShare’s spot Bitcoin ETF in September. Source: Eric Balchunas

Related: Bitcoin ETF options expected by Q1 2025: Bloomberg analyst

In August, Cboe filed with the SEC requesting authorization to list options on nine ETFs, including BlackRock’s iShares Ethereum Trust ETF, Fidelity Ethereum Fund, Grayscale Ethereum Trust, and Grayscale Mini Ethereum Trust, among others.

In September, the SEC delayed a similar proposed rule change from Nasdaq’s electronic exchange requesting a greenlight to list options on iShares Ethereum Trust.

On Sept. 20, the SEC authorized Nasdaq to list options tied to BlackRock’s Bitcoin ETF, iShares Bitcoin Trust (IBIT).

The Bitcoin BTC $62,716 options are awaiting final signoffs from the Commodity Futures Trading Commission (CFTC) and Options Clearing Corporation (OCC) before listing.

Options on BTC ETFs are likely to launch in the United States by the first quarter of 2025, according to James Seyffart, a Bloomberg Intelligence analyst.

“I think before the end of the year is possible for options, but more likely in Q1 2025,” Seyffart said on Oct. 9.

Source: Jeff Park

Options are contracts granting the right to buy or sell — “call” or “put” in trader parlance — an underlying asset at a certain price. In the US, if one party fails to uphold the agreement, the OCC intervenes and settles the trade.

Listing spot crypto options on regulated US exchanges — where the OCC safeguards traders against counterparty risk — marks a “monumental advancement” in crypto markets and creates “extremely compelling opportunities” for investors, Jeff Park, Bitwise Invest’s head of alpha strategies, said in a Sept. 20 X post.

Financial advisers, who control as much as half of investment flows in the $9 trillion ETF market, rely on options to safeguard against sharp market movements. More than 10% of advisers actively used options to manage client portfolios as of 2023, according to a survey by The Journal of Financial Planning.

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