In a bold statement on February 5th, CEO of Grayscale, Michael Sonnenshein, made a passionate plea to regulators, urging them to approve spot Bitcoin exchange-traded fund (ETF) options. Sonnenshein emphasized the critical need for the development of a robust listed options market for spot Bitcoin ETFs. He pointed out that although the Grayscale Bitcoin Trust (GBTC) has been in the public market since 2015, it has never been accompanied by listed options due to their absence in the OTC Market.
Sonnenshein argued that similar products, such as bitcoin futures ETFs, and spot bitcoin ETFs, should be treated equally. He emphasized the importance of granting listed options on these products. The CEO highlighted that the New York Stock Exchange (NYSE) and other national securities exchanges have recently submitted filings for options trading on commodity-based ETFs, including Grayscale’s GBTC fund. Now, it is up to the Securities and Exchange Commission (SEC) to consider these applications.
Sonnenshein went on to emphasize the benefits of introducing options for investors in the Bitcoin market. He stated that options support price discovery, allowing for better navigation of market conditions. Additionally, options can generate income for both retail and institutional investors. The CEO firmly believes that the introduction of spot Bitcoin ETF options would be advantageous and provide investors with more robust investment opportunities.
The SEC’s Consideration and Possible Timeline
Currently, the SEC is in the process of reviewing various spot Bitcoin ETF applications. The agency opened comments on BlackRock’s Nasdaq-listed fund and various Cboe BZX-listed funds on January 19th. Bloomberg ETF analyst James Seyffart predicts that a decision may be reached between February and September 2024. However, according to separate reports from Reuters, a decision might potentially be delayed until December 2024. This delay is attributed to the possibility that both the SEC and the Commodity Futures Trading Commission (CFTC) will need to grant approval.
Grayscale’s GBTC ETF, which was converted from an existing fund, is currently the largest spot Bitcoin ETF in terms of assets under management (AUM), standing at $20.5 billion as of February 2nd. However, the fund has also experienced significant outflows. Despite this, Grayscale remains a major player in the Bitcoin market, and their CEO’s plea for spot Bitcoin ETF options showcases their commitment to the advancement of the industry.
Michael Sonnenshein, the CEO of Grayscale, has made a compelling case for the approval of spot Bitcoin ETF options. He stressed the importance of a robust listed options market, equal treatment of similar products, and the benefits that options can provide for investors. With the SEC currently reviewing various applications, the future of spot Bitcoin ETFs remains uncertain. However, Grayscale’s dominance in the market and their continued advocacy for innovation demonstrate their dedication to pushing the industry forward.
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