2 hours ago Why Aren’t There Options on the New Bitcoin ETFs Yet? By Alexander Osipovich , Reporter Some crypto traders have been wondering when they’ll be able to trade options on the new spot bitcoin exchange-traded funds that started trading earlier this month. The short answer: It might be a while. Wall Street can move fast in listing options tied to popular new ETFs. When the first bitcoin-futures ETF started trading in October 2021, it was only a few days before put and call options on the new ProShares Bitcoin Strategy ETF appeared. But the new spot bitcoin ETFs are a different type of fund, because they’re backed by digital coins rather than futures contracts. So different rules apply, similar to the rules for listing options on precious-metals ETFs backed by physical gold or silver. Two things need to happen before you’ll see options on ETFs such as BlackRock’s iShares Bitcoin Trust. First, exchanges must ask permission from the Securities and Exchange Commission to amend their rulebooks to list options on the new ETFs–a process that they don’t have to undertake for most new options contracts. The New York Stock Exchange, Nasdaq and Cboe Global Markets have all submitted applications for rule changes allowing them to list options on spot bitcoin ETFs. It can take months for the SEC to approve or reject such applications. There’s also a second, even more obscure thing that needs to happen: the Options Clearing Corporation must agree to clear and settle the new options contracts. The OCC is the clearinghouse that processes U.S. options trades. Last week, it released a memo saying it was “working with its regulators” to determine what sort of approvals were needed before it could clear options on spot bitcoin ETFs. What does that mean? According to people familiar with the process, the OCC won’t be able to move forward on clearing options on spot bitcoin ETFs unless it gets a special exemption from the Commodity Futures Trading Commission. And past history suggests the CFTC might not move fast in granting such an exemption. In 2008, the CFTC provided an exemption for the OCC to clear options on the SPDR Gold Trust, the popular physical-gold ETF. The agency later cleared the way for options on a few other precious-metals ETFs. But the CFTC never signed off on a 2010 application by the OCC to clear options on a pair of physical palladium and platinum ETFs. The CFTC postponed making a decision on OCC’s application dozens of times, regulatory filings show. The reasons for the delay aren’t fully clear, but they appeared to involve inter-agency discussions with the SEC. To this day, you can't trade options on those physical palladium and platinum ETFs. So crypto traders may be in for a long wait.
Because no one is interested in BTC derivatives. Just look at the BTC futures from CME. After so many years, the daily volume is still pathetic; it could hardly exceed 10K / day. Fortunately, CBOE gave up the BTC futures trading business.
That is because the premium was ridiculously high. If the crypto bros were smart they would be selling CCs on their holdings, but how many people have 100 BTCs? Nevertheless the ETF makers should play the option game and push for options. Greyscale holding 5-600K coins, the premium is a nice way of making money in a sideways market. << what cryptos eventually will end up doing
BITO has options but the spread doesn't make sense to me. It is always like 10-30% for no good reason. Even option contracts with huge volumes & very large open interest have huge spreads. I don't know if that will change for the spot ETFs.
“There's a sucker born every minute” isn't just cooked up for nothin'. You need a sucker to literally make a sucker. This is really THE holy grail of trading.