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Nasdaq has applied to the U.S. Securities and Exchange Commission (SEC) to remove position limits on option contracts linked to spot Bitcoin and Ethereum ETFs, with the change effective as of January 2026.
Nasdaq's proposed rule change, submitted on January 7, 2026, was granted expedited approval by the SEC on January 21, making it effective immediately. This removes the existing 25,000 contract position and exercise limit on options linked to major spot Bitcoin ETFs such as BlackRock's iShares Bitcoin Trust (IBIT), Fidelity Wise Origin Bitcoin Fund, Grayscale Bitcoin Trust, Bitwise Bitcoin ETF, ARK 21Shares Bitcoin ETF, and VanEck Bitcoin ETF, as well as similar Ethereum ETFs (e.g., iShares Ethereum Trust).
These limits were previously in place due to restrictions specific to crypto assets. With its removal, these options will now be subject to the standard Nasdaq options rules (Options 9, Sections 13 and 15) that apply to other commodity-based ETF options. Nasdaq stated that the change will bring crypto products to the same level as traditional markets and continue to provide investor protection.
**What does this mean?**
Position limits restrict the maximum number of contracts an investor or institution can hold in a particular option contract; this is put in place to mitigate the risk of market manipulation, cornering, or overspeculation. The 25,000 contract limit prevented large institutional investors (hedge funds, market makers) from developing larger-scale strategies. Removing the limit:
- Increases liquidity in the options market and allows for deeper trading volumes.
- Allows institutional investors to more effectively hedge or speculate on their exposure to Bitcoin and Ethereum with options. - Bringing crypto ETF options to the same level as other commodity ETFs like gold or oil accelerates the integration of crypto assets into the mainstream financial system.
This step is considered a significant development in the maturation process of Bitcoin ETF option trading, which is scheduled to begin in late 2025. While the SEC still has the authority to suspend the change within 60 days, trading is currently unrestricted.
#ETF
Nasdaq's proposed rule change, submitted on January 7, 2026, was granted expedited approval by the SEC on January 21, making it effective immediately. This removes the existing 25,000 contract position and exercise limit on options linked to major spot Bitcoin ETFs such as BlackRock's iShares Bitcoin Trust (IBIT), Fidelity Wise Origin Bitcoin Fund, Grayscale Bitcoin Trust, Bitwise Bitcoin ETF, ARK 21Shares Bitcoin ETF, and VanEck Bitcoin ETF, as well as similar Ethereum ETFs (e.g., iShares Ethereum Trust).
These limits were previously in place due to restrictions specific to crypto assets. With its removal, these options will now be subject to the standard Nasdaq options rules (Options 9, Sections 13 and 15) that apply to other commodity-based ETF options. Nasdaq stated that the change will bring crypto products to the same level as traditional markets and continue to provide investor protection.
**What does this mean?**
Position limits restrict the maximum number of contracts an investor or institution can hold in a particular option contract; this is put in place to mitigate the risk of market manipulation, cornering, or overspeculation. The 25,000 contract limit prevented large institutional investors (hedge funds, market makers) from developing larger-scale strategies. Removing the limit:
- Increases liquidity in the options market and allows for deeper trading volumes.
- Allows institutional investors to more effectively hedge or speculate on their exposure to Bitcoin and Ethereum with options. - Bringing crypto ETF options to the same level as other commodity ETFs like gold or oil accelerates the integration of crypto assets into the mainstream financial system.
This step is considered a significant development in the maturation process of Bitcoin ETF option trading, which is scheduled to begin in late 2025. While the SEC still has the authority to suspend the change within 60 days, trading is currently unrestricted.
#ETF
