- Options trading for spot Bitcoin ETFs could attract more institutional interest.
- Bitcoin ETFs see record inflows, but volatility and profit-taking drive occasional outflows.
As a seasoned analyst with over two decades in the financial industry, I’ve seen my fair share of market trends and product innovations. The upcoming options trading for spot Bitcoin ETFs is indeed an exciting development that could potentially draw more institutional interest to the cryptocurrency space.
As an analyst, I’m eagerly anticipating the launch of options trading for spot Bitcoin [BTC] exchange-traded funds (ETFs), set for the 19th of November. This development is viewed as a significant stride in piquing increased institutional involvement with Bitcoin, often referred to as the ‘king coin’.
For those who might not know, derivatives like options grant investors the ability to either purchase or sell an underlying asset, such as BlackRock’s IBIT Bitcoin ETF, at a fixed price over a defined period of time.
This advanced trading resource lets you place leveraged wagers on Bitcoin’s value fluctuations, and it additionally provides a tactic for protecting your other investment positions.
Execs weigh in
In a recent chat with Bloomberg TV, Alison Hennessy, who leads ETP listings at Nasdaq, pointed out:
At Nasdaq, we aim to make these options available for listing and trading as soon as possible, potentially even tomorrow. I believe many investors are eagerly anticipating this development since they’ve expressed interest in having these options traded on our platform, IBIT.
At present, the United States has a total of eleven Bitcoin Spot ETFs available, yet only one of them, IBIT, is traded on the Nasdaq. This sets IBIT apart as the single ETF authorized for options trading.
In September, the Security and Exchange Commission gave their approval to various option types for the company IBIT, as well as modifications to the rulebooks for Bitcoin ETFs listed on the New York Stock Exchange (NYSE) and Cboe Global Markets.
With options trading growing in popularity, analyst James Seyffart from Bloomberg Intelligence hints that similar options for additional Bitcoin ETFs might be introduced shortly.
This might broaden the variety of cryptocurrency-related derivative trading possibilities.
As an analyst, I can confidently say that it seems imminent that these items will commence trading within the forthcoming days, possibly as soon as the next couple. From our observations, all regulatory and administrative obstacles appear to have been overcome. Now, it’s merely a question of finalizing minor details and completing formalities.
Spot Bitcoin ETF success record
During the period from November 11th to November 15th, Bitcoin exchange-traded funds (ETFs) have continued a steady surge, attracting approximately $1.67 billion in investments. This marks the sixth consecutive week of growth in these ETFs, as reported by SoSoValue.
The iShares Bitcoin Trust from BlackRock, named IBIT, has remarkably excelled, amassing a total of $29.3 billion through past investments.
Compared to when spot Bitcoin ETFs were introduced in January, Grayscale’s Bitcoin Trust ETF has seen a total withdrawal of approximately $20.3 billion.
Over the past week, the upward momentum has not only affected Bitcoin but also Ethereum-based spot ETFs. These ETFs experienced an increase of approximately $515 million, leading their cumulative inflow over the last three weeks to reach a total of $682 million.
Is Bitcoin the main driver of success?
To put it simply, I’ve noticed an uptick in cryptocurrency exchange-traded products lately, which seems to be fueled by Bitcoin reaching new heights. This trend suggests that more and more investors are trusting the potential of the digital asset market, and I find that quite encouraging.
Yet, these later withdrawals underscore the unpredictability typical of such market surges, as investors often choose to cash in their gains following significant price hikes.
In a world where markets are constantly changing, maintaining a delicate equilibrium between incoming investments and outgoing ones will play a vital role in assessing whether this bullish run can be maintained. Notably, Bitcoin and other digital currencies continue to capture investors’ attention.
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2024-11-20 01:44