Bitwise Asset Management has announced that options trading for its Bitcoin (BTC) ETF, BITB, will begin on November 20.
The market is already abuzz with activity as recent BlackRock’s ETF Options marked a huge milestone and garnered immense market interest.
This marks a significant step for cryptocurrency investment as more advanced trading features become available. The move is likely to attract increased participation from retail and institutional investors.
BlackRock IBIT Sets Trend for ETF Options
Bitcoin ETF options allow investors to buy or sell ETFs at a set price within a specified time. The flexibility of managing Bitcoin (BTC) exposure makes it suitable for speculative traders and investors seeking more control over it.
Now with the launch of options for BITB, industry experts expect more liquidity and broader adoption of Bitcoin ETFs.
Bitwise’s announcement comes shortly after the BlackRock iShares Bitcoin Trust (IBIT) started options trading at the end of November.
Bloomberg analysts say these breakthroughs could pave the way for similar ETFs across the Bitcoin ET market.
Adding options can be a huge market activity booster, providing the space with more powerful trading tools.
However, regulatory constraints on Bitcoin ETF options trading remain a worry. In particular, Jeff Park, Head of Alpha Strategies at Bitwise, highlighted some pitfalls associated with position limits and, for example, IBIT.
According to him, these limits, at 25,000 contracts, should be fixed versus the 400,000 options IBIT theoretically could hold.
Park compared these to CME Bitcoin futures, which will take a cap higher, about around 175,000 ETF options contracts.
Such limitations could, he warned, distort market conditions by exaggerating volatility and making transactions more difficult for natural buyers and sellers.
However, he advised retail traders to watch for smaller ETFs with untapped opportunities. He has recently posted an update on X (Twitter) mentioning the highly anticipated launch of Bitcoin ETF options trading by Bitwise.
SEC Oversight Strengthens Bitcoin ETF Options Rollout
In 2024, the regulatory ecosystem for Bitcoin ETF options has changed quite a bit as the Commodity Futures Trading Commission (CFTC) transferred its authority to the SEC.
Park praised the CFTC’s decision, which gave users a smoother rollout of these types of investment products.
The SEC’s oversight is important, he noted, because ETF option activations fall under particular securities laws.
Industry analysts expect regulatory clarity to instigate more innovation and bitcoin ETF adoption.
The new developments from BlackRock and Bitwise signify growing regulatory certainty that Bitcoin can be brought into the traditional financial system. It is a milestone for the maturing cryptocurrency investment landscape.
Spot Bitcoin ETFs See $254 Million Inflows
Options trading is introduced at a time when there is strong investor demand for Bitcoin-based financial products.
Crypto analysis platform SoSoValue reported net $254 million inflows into spot Bitcoin ETFs on November 18.
This followed two straight days of $770 million outflows, which demonstrate these products’ volatile but resilient interest.
BlackRock’s iShares Bitcoin Trust saw $89.3 million daily inflows among the leading ETFs.
FBTC saw $60 million among Fidelity, $44 million among VanEck’s HODL, Bitwise BITB, and ARK 21Shares ARKB.
Inflows to Grayscale’s GBTC and its mini fund topped $60 million, showing how popular Bitcoin ETFs are.
