Bitcoin ETF options expected to launch by early 2025

Bitcoin (CRYPTO:BTC) exchange-traded fund (ETF) options are expected to roll out in the U.S. by the first quarter of 2025, according to Bloomberg Intelligence analyst James Seyffart. 

Speaking at the Permissionless conference on October 9, Seyffart noted that while the launch of options before the end of 2024 is possible, a more likely timeline is early 2025.

The U.S. Securities and Exchange Commission (SEC) recently gave approval for Nasdaq to list options related to BlackRock’s Bitcoin ETF, iShares Bitcoin Trust (IBIT). 

However, the final signoff is still needed from the Commodity Futures Trading Commission (CFTC) and the Options Clearing Corporation (OCC). 

According to Seyffart, these regulatory bodies don’t have strict deadlines, meaning further delays are possible.

Options are financial contracts that give traders the right to buy or sell assets at a predetermined price. 

For Bitcoin ETFs, this new offering will provide a regulated market where the OCC safeguards against counterparty risks. 

According to Jeff Park, head of alpha strategies at Bitwise Invest, this will allow Bitcoin’s synthetic exposure to grow significantly without default risk, creating more opportunities for investors.

Financial advisers, who manage a large portion of investment flows in the $9 trillion ETF market, have been looking for ways to mitigate Bitcoin’s volatility. 

According to a 2023 survey by The Journal of Financial Planning, over 10% of advisers actively use options to manage risk for client portfolios. 

Seyffart added that Bitcoin ETF options could help advisers become more comfortable with the asset class, particularly in managing volatility concerns.

The launch of Bitcoin ETF options is seen as a key step in broadening Bitcoin’s appeal among traditional investors.

At press time, the Bitcoin price was $60,557.46.