US Lawmakers Urge SEC to Approve Bitcoin Options Trading Amid Regulatory Scrutiny
Summary:
U.S. Representatives Mike Flood and Wiley Nickel are urging the Securities and Exchange Commission (SEC) to approve options trading on Bitcoin-based exchange-traded products, or provide a reason for the different treatments between Bitcoin futures ETFs and spot Bitcoin ETPs. The commission has resisted making judgments on submissions from the New York Stock Exchange, Nasdaq, and Cboe Global Markets. The SEC is currently seeking public feedback on how Bitcoin options could affect market stability. Responses and rebuttals are invited until May 15 and 29, 2024, respectively.
It has been reported that U.S. legislators are significantly persuading the Securities and Exchange Commission (SEC) to greenlight the trading of options on Bitcoin-based exchange-traded products (ETPs). As per an Axios report, Representatives Mike Flood and Wiley Nickel have penned a communique to Gary Gensler, the Chairman of the Commission, urging an end to prejudices against crypto-focused funds. Their bipartisan letter states, "It is our appeal to you, devoid of any hold-up, to authorize options on spot Bitcoin ETPs or furnish an account of the Commission’s disparate behavior when it comes to options for Bitcoin futures ETFs - already traded - and the spot Bitcoin ETPs options.” Options are fiscal tools that entail the buyer with the privilege, yet no obligation, to purchase or dispose of an asset - in this case, Bitcoin - at a predetermined rate by an assured date. This tool is typically employed for safeguarding against price fluctuations, minimizing probable losses and endowing investors with the capacity to generate added revenue through strategies. As per Flood and Nickel, the approval is crucial for those investors whom the SEC is set to guard. The SEC has persistently been reserved on making a decision on proposals from the New York Stock Exchange, Nasdaq, and Cboe Global Markets, which were presented in January. Nasdaq has filed to register and trade options on BlackRock's iShares Bitcoin Trust, while Cboe plans to host options trading on multiple BTC funds. In a similar vein, the NYSE seeks to trade options on BITB's Bitwise Bitcoin ETF, GBTC's Grayscale Bitcoin Trusts and any other Bitcoin-centric trusts. The Commission, of late, has launched a fresh round of consultations on the suggested amendments to rules that would permit options trading on Bitcoin funds. The SEC is soliciting public opinions on Bitcoin options trading, as per a source from the SEC. A filing dated April 24 reveals that the SEC is analyzing the prospective effects of Bitcoin options on market stability, particularly in volatile scenarios. The agency is also investigating if the present market surveillance and enforcement policies suffice in managing the intricacies of Bitcoin options. Initial comments can be provided until May 15, 2024, and counterarguments must be submitted by May 29, 2024. As revealed by Magazine publishing, 1 in 6 new Base memecoins are fraudulent, with 91% having susceptibilities.
Published At
5/2/2024 9:20:00 PM
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