Nasdaq has taken a significant step toward reshaping the crypto derivatives landscape by filing a rule change with the US Securities and Exchange Commission to eliminate position limits on options tied to spot Bitcoin and Ether exchange-traded funds. The move aims to bring crypto ETF options in line with how other commodity-based ETF options are regulated.
Under the filing, Nasdaq would remove the existing 25,000-contract cap on options linked to several Bitcoin and Ether ETFs listed on the exchange. The SEC waived its standard 30-day review period, allowing the change to take effect immediately, while retaining the right to suspend it within 60 days if concerns arise. A public comment period is now open, with a final decision expected by late February.
Options position limits are traditionally used to reduce risks such as market manipulation, excessive speculation, and concentrated exposure. Nasdaq argues that maintaining strict caps on crypto ETF options creates unequal treatment compared to other commodity-linked funds, without providing additional investor protection.
This filing builds on Nasdaq’s earlier approval to list options on single-asset crypto ETFs as commodity-based trusts, while leaving limits intact. The exchange has also proposed higher limits for certain Bitcoin ETF options and continues to expand its crypto benchmarks and derivatives offerings.
If finalized, the rule change could improve liquidity, support hedging strategies, and further integrate digital assets into traditional financial markets, signaling a maturing regulatory approach to crypto-based products.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.