Key Points
- The U.S. SEC has approved more U.S. spot Bitcoin ETF options, potentially injecting more liquidity into BTC markets.
- Analysts are divided on the impact of this approval on BTC market volatility and price in the long run.
The U.S. Securities and Exchange Commission (SEC) recently approved more U.S. spot Bitcoin (BTC) ETF options. This decision has prompted various market commentaries.
The green light was given on October 18th for products on the NYSE (New York Stock Exchanges) and Cboe (Chicago Board Options Exchange). NYSE American can now offer options for Fidelity’s BTC fund, FBTC, and ARK 21Shares’ ARKB, while Cboe will trade Grayscale’s GBTC, mini BTC, and Bitwise’s BTIB.
Analysts’ Views on U.S. BTC ETF Options
The potential impact of this approval on the BTC market and price has stirred mixed views among analysts. Some believe it could lead to increased volatility and liquidity in Bitcoin. Options allow professional traders to speculate and employ risk management strategies without owning the underlying BTC asset.
BTC investor Anthony Pompiliano, after the approval of IBIT options, suggested that it would limit BTC’s upside potential and reduce its volatility. On the other hand, Bitwise’s Jeff Park viewed the approval as a net positive for BTC volatility, liquidity, and price.
Ed Tolson, CEO of Kbit, shared a similar sentiment, suggesting that institutional market makers might need to buy as the price rises and sell as it falls, potentially amplifying volatility. However, Michael Harvey, head of franchise trading at Galaxy Digital, projected a short-term spike in volatility, which could be reduced in the long run.
Despite the divided opinions on volatility and price impact, analysts generally agree that the approval will inject more liquidity into BTC markets.