Nasdaq has formally requested approval from U.S. federal regulators to introduce spot Bitcoin ETF-based options.
The proposed offering, known as Nasdaq Bitcoin Index Options (XBTX), was submitted to the U.S. Securities and Exchange Commission (SEC) on Tuesday.
This initiative is designed to allow investors to better manage their Bitcoin positions and hedge their investments using options.
Options are financial contracts that provide the right, but not the obligation, to trade an asset at a predetermined price on a future date.
These tools are often utilised to mitigate investment risks.
CF Benchmarks, a firm with experience in cryptocurrency indexing, will oversee the index underlying the XBTX offering. Nasdaq's move is expected to further integrate the digital assets market with the more established securities markets.
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Nasdaq’s Vision
Greg Ferrari, Nasdaq’s Vice President and Head of Exchange Business Management, highlighted the significance of this proposal in a statement.
He noted that the collaboration combines the innovative nature of cryptocurrency with the stability and reliability of traditional markets.
Ferrari believes that this development could represent a milestone in the maturation of digital assets.
related reading:Nasdaq Proposes Listing Options on BlackRock's iShares Ethereum Trust
Related Proposals
Earlier this month, Nasdaq also proposed options based on BlackRock’s spot Ethereum ETF. Currently, options on ETFs tracking Bitcoin or Ethereum are not available in the United States, as the SEC has yet to approve such offerings despite ongoing requests from major institutional players.
SEC delays proposal
The SEC has delayed decisions on several similar proposals, including those from BlackRock and other institutional investors, since these spot Bitcoin ETFs received regulatory approval in January.
Some U.S. lawmakers have even applied pressure on the SEC to approve these investment products, with congressmen Mike Flood and Wiley Nickel urging the agency to move forward.
Spot Bitcoin ETFs have experienced large net inflows recently
The timing of Nasdaq’s request coincides with significant movements in the crypto market. Notably, BlackRock’s spot Bitcoin ETF recently saw its largest daily net inflow in over a month, with a $224.1 million inflow recorded on August 26.
This surge in inflows occurred as Bitcoin’s price experienced a minor decline following a rally.
related reading:BlackRock’s Head of Digital Assets Robert Michnick Reveals Reasons Behind Launching ETFs at Bitcoin Conference in Nashville
In contrast, other issuers of spot Bitcoin ETFs, including Bitwise, Fidelity, and VanEck, collectively observed a net outflow of $32.1 million on the same day.
Meanwhile, crypto investment products saw their largest inflows in five weeks, with $533 million entering the market between August 18 and 24, according to CoinShares.