CBOE Digital president says a spot bitcoin ETF approval will promote derivatives growth
CBOE’s John Palmer said that potential bitcoin ETF approvals would “pave the way” for pension funds to invest in a spot bitcoin ETF
CBOE Digital President John Palmer says that the potential approval for a spot bitcoin ETF could broaden the ecosystem for institutions and retail.
“I think seeing that approval really is gonna pave the way for pension funds and RIA-based funds to be able to invest assets in a spot Bitcoin ETF where they may not be able to gain that access today and just a native spot, Bitcoin token,” Palmer said.
Any potential approvals for an ETF could also change how institutions approach derivatives, Palmer added. Derivatives include options and futures contracts.
“So you have more players, institutional players that are used to hedging their risk. And so they lean on derivatives quite heavily to be able to hedge that risk…And so, as that ecosystem evolves, they’re going to lean on those derivatives more and more,” Palmer said.
Read more: This proposed bitcoin ETF has a twist. Would investors bite?
“So I think we’ll see that ecosystem on the derivative side, grow with the growth in the spot ETF as well.”
However, Palmer doesn’t think that the total breakdown will just be institutions. While he added that “it’s gonna be hard to judge what the breakdown is gonna be yet,” he also added that “institutions will lead the way” with the spot bitcoin ETF-involved participants using the hedging tools, but “retail will also look for that as well.”
Overall, ETFs give both institutions and retail a “broader ecosystem,” according to Palmer.
The US Securities and Exchange Commission is expected to hand down a decision on potential spot bitcoin ETFs by January 10. Ahead of the new year, a handful of potential issuers submitted fresh amendments to their S-1s, with firms including BlackRock disclosing authorized participants.
As Blockworks previously reported , the inclusion of APs is one of the details that the SEC is looking for ahead of potential approval.
“The SEC is ready to approve spot bitcoin ETFs, but only if they have clear language around cash-only creations and have a signed agreement with an authorized participant,” Bloomberg Intelligence analyst Eric Balchunas wrote in a note at the end of December.
Don’t miss the next big story – join our free daily newsletter .
- Cboe
- ETFs
- institutional adoption
- SEC
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
JPYC Inc. Launches Japan’s Pioneering Yen-backed Stablecoin
In Brief JPYC Inc. released Japan's first legally recognized yen-backed stablecoin, JPYC. JPYC operates on multiple blockchains and aims to reach 10 trillion yen circulation. Japanese tech and finance firms support JPYC’s integration into various ecosystems.
Massive Coin Releases Surge Crypto Market Activity
In Brief Tokenomist data reveals $653 million in coin releases from October 27 to November 3. SUI, GRASS, and SIGN coins will see significant market supply increases. Daily releases continue for major projects like Solana, Worldcoin, and Dogecoin.
Ant Group Blazes Trail with AntCoin Trademark Move
In Brief Ant Group applied for AntCoin trademark in Hong Kong, signaling digital finance aspirations. The company's move could align AntCoin with new stablecoin regulatory framework. AntCoin indicates Ant Group's strategic integration of traditional finance and blockchain.
ClearBank Pioneers a New Era in Blockchain Payments
In Brief ClearBank joins CPN for enhanced blockchain-based payments with Circle integration. Collaborative efforts focus on stablecoin-regulated international transfers. Innovations expected to reduce costs and dependency on traditional systems.
Trending news
MoreCrypto prices
More
