SEC clears Ethereum ETF options trading for BlackRock and Fidelity

The US Securities and Exchange Commission (SEC) approved proposals from Nasdaq and Cboe to database and commercialized options connected spot Ethereum (ETH) exchange-traded funds (ETFs) managed by BlackRock and Fidelity, according to April 9 filings.

The orders were granted for the iShares Ethereum Trust (ETHA) and the Fidelity Ethereum Fund (FETH) pursuing a reappraisal process that included amendments, nationalist comments, and regulatory justification for caller merchandise listings nether Section 19(b) of the Securities Exchange Act of 1934.

Contracts to connection American-style workout and modular settlement

Both filings approved options with American-style workout and carnal settlement. The approved contracts volition adhere to existing listing rules applicable to ETF options, including margin, onslaught intervals, bid expiration cycles, and minimum trading increments. 

The ETHA and FETH options volition beryllium taxable to a 25,000-contract presumption and workout bounds per marketplace side, conscionable arsenic the options for Bitcoin (BTC) ETFs were approved past year.

Nasdaq and Cboe emphasized the blimpish quality of the 25,000-contract cap, which was derived from a comparative investigation with different ETFs and commodity-based trusts.

Additionally, Nasdaq noted that the notional hazard of a maximum presumption successful ETHA would correspond little than 0.03% of the Ethereum market’s capitalization and beneath 4.4% of the trust’s outstanding shares. Cboe compared the projected limits to those acceptable for Bitcoin-based ETFs and likewise structured commodity products.

The approvals travel a precedent acceptable for spot Bitcoin ETF options, which received SEC authorization connected Sept. 23, 2024, and began trading successful November 2024.

As happened past year, options trading requirements from different issuers are apt to beryllium approved, with trading starting successful the aforesaid week arsenic ETHA and FETH.

The station SEC clears Ethereum ETF options trading for BlackRock and Fidelity appeared archetypal connected CryptoSlate.