The U.S. Securities and Exchange Commission has raised the options contract limit for certain Bitcoin ETFs from 25,000 to 250,000, a move that could significantly benefit institutional players. BlackRock’s iShares Bitcoin Trust, which manages $85.5 billion in assets, is set to gain the most. In contrast, Fidelity’s FBTC, managing $21.35 billion, is excluded.
This regulatory change allows for more advanced trading strategies, such as covered call selling, which can reduce portfolio risk. According to NYDIG’s Greg Cipolaro, the new rules could bring stability to Bitcoin’s price and make ETFs more appealing to large investors.
In another development, the SEC also approved the use of in-kind creation and redemption for crypto ETFs, allowing shares to be exchanged for actual crypto instead of cash. This improves market efficiency and enhances institutional access. These measures show regulators warming up to crypto markets, paving the way for greater participation and innovation.
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