Grayscale CEO Advocates Options for Bitcoin ETFs

Grayscale CEO, Michael Sonnenshein advocates for listed options on spot Bitcoin ETFs highlighting their absence in the current market.

Grayscale CEO, Michael Sonnenshein, has begun advocating to introduce listed options for spot Bitcoin ETF. This comes less than one month after the Securities and Exchange Commission (SEC) in the United States approved the sale.

According to Grayscale CEO, the Bitcoin exchange-traded fund (ETF) held by his company, GBTC has traded on the public market for a considerable amount of time, but it has never been listed on the options market.

On the other hand, Grayscale CEO connected this disadvantage to the fact that the over-the-counter (OTC) market does not include listed options as a feature. Options can be considered listed derivatives that give the holder the right to buy and sell an asset. There are many different ways to define options.

It could take the form of equities or exchange-traded products such as spot Bitcoin ETFs in this particular instance. Both of these options are possible. Both retail traders and institutional investors can benefit from using the listed options.

To begin, it is a more cost-effective method for traders to improve their purchasing power, while at the same time it is an effective tool for institutional investors to use to hedge risk. On the whole, they contribute to the robust and healthy position of the market, which is beneficial.

Additionally, it is valuable for the discovery of prices and even for the generation of income. There are various reasons why the listed options are not now available for spot Bitcoin exchange-traded funds (ETFs).

Still many market observers believe that the absence of a well-established regulatory structure is the most significant obstacle the offering must overcome.

The United States Securities and Exchange Commission (SEC) is often tasked with overseeing the technical regulation modifications that exchanges are required to implement before they are allowed to list options.

Similarly, this offering should be allowed a few days after the ETF begins trading as was the case with the first bitcoin futures exchange-traded funds (ETFs) that began trading in the United States on October 19, 2021 and made listed options accessible the following day.

Bitcoin on the other hand is considered a commodity by several market watchdogs hence, to obtain clearance, it would also be required to go through the Commodity Futures Trading Commission (CFTC).

In addition, the problem of Bitcoin (crypto) and jurisdiction is still a difficult one that the Commodity Futures Trading Commission (CFTC) is still attempting to resolve.

According to Grayscale CEO X article, the New York Stock Exchange (NYSE) and other national exchanges have submitted their Forms 19b-4, which seek to revise the listing requirements to authorize listed options on commodity-based exchange-traded funds (ETFs), such as spot bitcoin ETFs.

This is despite the fact that these issues remain unresolved. On the other hand, GBTC is currently in the lead in the spot Bitcoin ETF market by a significant margin.

Grayscale CEO spot Bitcoin exchange-traded fund (ETF) recorded a trading volume of $338 million on the sixteenth day of trading. BlackRock is following closely after, and the competitive landscape is becoming increasingly complex daily.