Nasdaq seeks SEC approval to start trading Bitcoin Index Options
The U.S. Securities and Exchange Commission (SEC) has received a filing from Nasdaq and CF Benchmarks pertaining to the listing and trading of Nasdaq Bitcoin Index Options (XBTX).
With new Bitcoin index options, @Nasdaq is providing investors with the opportunity to combine the hedging and income generation of options within the innovation of Bitcoin. Learn more about the filing here: https://t.co/TVuygu6vsN pic.twitter.com/zbT8yzBz32
— Nasdaq (@Nasdaq) August 27, 2024
With its first ever Bitcoin index options, Nasdaq is promoting the growth and adoption of digital asset trading, the press release stated.
Nasdaq filed a request to list and enable trading of Nasdaq Bitcoin Index Options (XBTX) with the SEC on August 27. If approved, CF Benchmarks, which will oversee the index supporting XBTX, and Nasdaq will collaborate to introduce these options.
This partnership seeks to provide a safer, more regulated, and more recognizable approach to trading Bitcoin options—a strategy that has seen a sharp increase in popularity in recent years.
Head of Index Options at Nasdaq John Black stated the company is building a place where investors can confidently invest in this innovative digital asset class. Black explained further that although trading Bitcoin index options is not new, Nasdaq's proposed offering stands out due to its strong foundation in reliable financial systems. We're removing a lot of the barriers to switching to a cryptocurrency exchange that's not subject to the same regulations as a listed exchange. That appeals to investors much more.
According to Black, investors will gain from increased security, regulatory clarity, and professionalism by having Bitcoin index options under the Nasdaq umbrella. In addition to providing exposure to the world of digital assets, Nasdaq Bitcoin Index Options may provide investors with the opportunity to use traditional options investment strategies that facilitate risk management and hedging.
If approved, the product will also facilitate more efficient trading. Black clarified that customers can use their existing accounts to access these options if they have retail accounts at reputable brokerages. Nasdaq serves as a stable link between the worlds of traditional securities markets and cryptocurrencies by utilizing its well-established and reliable technological architecture. The structure of the product will be European-style, which means that options can only be exercised at expiration.
Greg Ferrari, vice president and head of exchange business management at Nasdaq, said that this partnership would mark a significant milestone in expanding the maturation of the digital assets market and further combine the innovative crypto landscape with the resilience and reliability of traditional securities markets.
Spot options settling to BRRNY will complement the spot ETFs that have already proven to be very popular with investors and will give investors the confidence to deploy more sophisticated ways to gain exposure to the largest digital asset, according to CF Benchmarks CEO Sui Chung.
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