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In a bipartisan effort, US Representatives Mike Flood and Wiley Nickel have penned a letter to SEC Chair Gary Gensler, urging swift action in approving options trading for Bitcoin exchange-traded products (ETPs). Amid mounting pressure for cryptocurrency market inclusivity, lawmakers assert that delay in approval constitutes discrimination against Bitcoin funds.
Bipartisan Push for Inclusive Markets: Lawmakers Challenge SEC on Bitcoin Options Trading
US politicians allegedly urge the Securities and Exchange Commission to allow options trading on Bitcoin exchange-traded products (ETPs).
According to Axios (via Cointelegraph), Representatives Mike Flood and Wiley Nickel recently signed a letter to the SEC's chair, Gary Gensler, urging the agency to stop discriminating against cryptocurrency funds.
The bipartisan letter reads, "We urge you, without delay, to approve options on spot Bitcoin ETPs or to provide an explanation for the Commission's difference in treatment between options for Bitcoin futures ETFs—which are currently trading—and options for the spot Bitcoin ETPs.”
Options are financial products that grant the buyer the right, but not the responsibility, to buy or sell an asset — in this example, Bitcoin — at a predetermined price by a specific date. The instrument is often used to hedge against market swings, reduce potential losses, and allow investors to create additional revenue through various tactics.
According to Flood and Nickel, approval is critical for investors that the SEC "seeks to protect."
The regulator has been deferring decisions on petitions from the New York Stock Exchange, Nasdaq, and Cboe Global Markets, submitted in January.
SEC Scrutinizes Bitcoin Options: Regulatory Review Amid Nasdaq, Cboe, and NYSE Moves
Nasdaq has filed to list and trade options on BlackRock's iShares Bitcoin Trust, while Cboe aims to allow options trading on several BTC funds. Similarly, the NYSE intends to trade options on Bitwise Bitcoin ETF, Grayscale Bitcoin Trusts, and any other trusts that hold Bitcoin.
Recently, the commission launched a new consultation round on the proposed rule change that would allow options trading on Bitcoin funds.
According to an April 24 filing, the SEC intends to investigate how Bitcoin options may affect market stability, particularly under volatile times. The agency is also looking into whether current market surveillance and enforcement techniques are enough to manage Bitcoin options' intricacies. Participants are asked to submit their initial remarks by May 15 and rebuttal responses by May 29.
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