Nasdaq ISE Proposes 10x Increase in IBIT Options Trading Limits
Nasdaq’s options exchange Nasdaq ISE, LLC has submitted a proposal to the U.S. SEC (Securities and Exchange Commission) to significantly increase the position and exercise limits for BlackRock iShares Bitcoin Trust ETF (IBIT) options.
The proposal seeks to increase the current cap of 25,000 contracts to 250,000, citing growing IBIT options trading volume and liquidity.
Nasdaq pushes to increase IBIT options limits
in its ArchiveNasdaq ISE cited IBIT’s rapid growth and institutional appeal. Specifically, it has a market capitalization of $46.8 billion and average daily trading volume of 39.4 million shares. The exchange said these indicators reflect the need to increase trading limits to better meet the needs of large-scale investors.
The proposal draws on the experience of the New York Stock Exchange (NYSE), which proposed extending trading hours for Bitcoin ETFs (exchange-traded funds) in October. According to BeInCrypto, NYSE Arca says demand is growing.
However, for the Nasdaq ISE, the proposed increase would bring IBIT option limits in line with or even lower than comparable ETFs. For example, SPDR Gold Shares (GLD) and iShares Silver Trust (SLV) have higher position limits relative to their respective floats. ISE noted that GLD’s position limit accounts for 8.17% of its circulating supply, while SLV’s is 4.8%.
In comparison, the proposed IBIT limit of 250,000 contracts represents only 2.89% of the ETF’s total shares. This conservative approach is further supported when compared to the ProShares Bitcoin Strategy ETF (BITO), which has a position limit of 23.22% of its float.
Impact of IBIT options trading limit extension
If approved, the new restrictions could significantly enhance market liquidity. It will also provide institutional players with greater flexibility to hedge their Bitcoin-related positions.
“The exchange believes that increasing the position (and exercise) limits on IBIT options will result in a more liquid and competitive market environment,” ISE said.
The SEC has 45 days to evaluate the proposal, after which it can approve, disapprove or initiate further proceedings. Meanwhile, IBIT has steadily won over institutional investors since it was approved four months ago. BlackRock’s Bitcoin ETF options appear on first day of trading Sales exceed $425 millionreflecting pent-up demand for regulated Bitcoin exposure.
this SEC gives green light to IBIT options trading Last September was a critical moment. It provides investors with a regulated way to hedge against Bitcoin price fluctuations. Nasdaq ISE’s latest proposal builds on this momentum, joining broader industry efforts to integrate digital assets into traditional finance.
Nasdaq’s move to expand IBIT options trading is part of a broader strategy to increase its digital asset offerings. In August, it also attempted Providing BlackRock Spot Ethereum ETF options trading. The exchange also plans to seek approval for Bitcoin options trading tied to the CME CF Bitcoin Live Index. The move mirrors a similar move by the New York Stock Exchange.
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