Bitwise expects options trading for its Bitcoin ETF to start tomorrow Bitwise expects options trading for its Bitcoin ETF to start tomorrow
Options trading for Bitcoin ETF is expected to enhance market liquidity and attract diverse investor engagement.
2 min read
Updated: Nov. 19, 2024 at 12:28 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Bitwise CEO Hunter Horsley announced that options trading on the firm’s Bitcoin ETF product BITB will commence on Nov. 20.
In a Nov. 19 post on X, Horsley stated:
“We expect options on the Bitwise Bitcoin ETF (BITB) to begin trading Wednesday.”
According to Bloomberg ETF analyst James Seyffart, this could signal the introduction of similar options features across other Bitcoin ETFs. The news came shortly after the Office of the Comptroller of the Currency (OCC) confirmed that options trading for BlackRock’s iShares Bitcoin Trust (IBIT) would begin today, Nov. 19.
Options trading allows investors to buy or sell assets at a set price within a specific timeframe, offering flexibility for speculation and risk management. As such, the introduction of this feature is expected to increase investor options for managing Bitcoin exposure.
Industry experts believe it will enhance market liquidity, attract new participants, and integrate Bitcoin into the broader financial system.
Limitation still exists
However, not all aspects of the new options trading environment are without concerns. Bitwise’s Jeff Park, Head of Alpha Strategies, expressed reservations regarding the position limits imposed on Bitcoin ETFs.
For instance, BlackRock’s IBIT is capped at 25,000 contracts, which Park argues is too low compared to the 400,000 options the ETF could support. He wrote:
“IBIT should have qualified for 400,000 options. To put this into context, CME Bitcoin futures contracts have a 2,000-contract limit, which is equivalent to about 175,000 contracts for IBIT. Instead, we were given just 280 Bitcoin futures contracts.”
Park explained that such restrictions could disrupt market conditions, forcing natural buyers and sellers to navigate complex volatility patterns. Nevertheless, the Bitwise executive pointed out that retail traders should not focus solely on larger ETFs like IBIT but also explore other issuers, which could present attractive opportunities.
Meanwhile, Park acknowledged that the regulatory landscape has progressed significantly in 2024, with the CFTC deferring authority for ETF options to the SEC. He stated:
“If the CFTC had been as politicized as the SEC, we might not have had a fair launch at all. Their willingness to cede authority for ETF options to the SEC, recognizing them as securities within the scope of the law, is commendable.”
Strong ETF flows
The development surrounding the Bitcoin ETF options trading comes as the financial instruments continue to attract strong investor interest 11 months after their launch.
Data from crypto analysis platform SoSoValue shows net inflows of $254 million for spot Bitcoin ETFs on Nov. 18, rebounding after two days of $770 million in outflows.
BlackRock’s iShares Bitcoin Trust led the pack with $89.3 million daily inflows, followed by Fidelity’s FBTCย with $60 million. Bitwise BITB, VanEck’s HODL, and ARK 21Shares ARKB recorded $44 million in inflows.
Additionally, GGrayscale’sGBTC and its mini fund posted around $60 million combined inflows.
These developments underline the growing demand for Bitcoin-based investment vehicles as the market matures and offer new opportunities for retail and institutional investors.
Mentioned in this article
Bitcoin 
BlackRock 
Bitwise 
VanEck 
Grayscale Investments 
Fidelity Investments 
Bitwise Bitcoin ETF 
Grayscale Bitcoin Trust iShares Bitcoin Trust 
Fidelity Wise Origin Bitcoin Trust 
ARK 21Shares Bitcoin ETF 
Hunter Horsley 
James Seyffart Author 
Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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In this article
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
BlackRock
BlackRock, synonymous with global asset management, is an American multinational investment management corporation based in New York City.
Bitwise
Bitwise Asset Management pioneered the first cryptocurrency index fund and is the leading provider of rules-based exposure to the cryptoasset space..
VanEck
VanEck is a global investment manager with offices around the world, including New York, Australia, China, Germany, Netherlands and Switzerland.
Grayscale Investments
Established in 2013 by Digital Currency Group, Grayscale Investments is a trusted authority on digital currency investing and cryptocurrency asset management.
Fidelity Investments
Fidelity Investments Inc., commonly referred to as Fidelity, is a multinational financial services corporation based in Boston, Massachusetts.
The Bitwise Bitcoin ETF (BITB) is a newly launched exchange-traded fund that provides investors with exposure to Bitcoin.
The Grayscale Bitcoin Trust (GBTC) is a digital currency investment product that provides investors with access to Bitcoin through traditional investment channels.
The BlackRock Bitcoin ETF, known as the iShares Bitcoin Trust (IBIT), is an investment fund that provides regulated exposure to Bitcoin for investors.
The Fidelity Wise Origin Bitcoin Trust (FBTC) is a spot Bitcoin ETF that offers investors exposure to the price of Bitcoin.
The ARK 21Shares Bitcoin ETF (ARKB) is a digital asset ETF that seeks to track the performance of bitcoin, as measured by the performance of the CME CF Bitcoin Reference Rate โ New York Variant (the “Index”).
Hunter Horsley, the Co-founder and CEO of Bitwise Asset Management, brings a wealth of experience from his tenure as a Facebook product manager.
James Seyffart is a well-regarded analyst at Bloomberg Intelligence, specializing in Exchange-Traded Funds (ETFs) and the broader fund industry.