Grayscale to Launch Bitcoin ETF Options Following BlackRock’s Record Debut

Ruholamin Haqshanas

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Ruholamin Haqshanas

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Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

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November 20, 2024

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Grayscale Investments is set to introduce options trading on its spot Bitcoin ETFs this Wednesday.

The move comes amidst a surge in investor interest, as indicated by the record-breaking performance of BlackRock’s iShares Bitcoin Trust (IBIT) on its first day of options trading.

BlackRock’s IBIT recorded nearly $1.9 billion in notional exposure traded on its debut, including 354,000 contracts, with a striking 4.4:1 call-to-put ratio.

Overheated Options Market Pushes Bitcoin Above $94,000

The overwhelming interest in call options played a major role in Bitcoin’s surge to an all-time high of $94,041 on Tuesday.

In response, Grayscale plans to launch options trading for its Grayscale Bitcoin Trust (GBTC) and Bitcoin Mini Trust (BTC).

The firm aims to “further develop the ecosystem” surrounding its U.S.-listed Bitcoin exchange-traded products (ETPs), according to a company statement.

Grayscale’s swift action follows the Options Clearing Corporation’s (OCC) recent approval of Bitcoin ETF options.

The company filed an updated prospectus for its Bitcoin Covered Call ETF on January 11.

The fund is designed to generate income using a covered call strategy—writing and buying options contracts on Bitcoin ETPs while holding Bitcoin or GBTC as collateral.

Bloomberg ETF analyst James Seyffart highlighted the rapidity of Grayscale’s response to the OCC’s clearance.

“They’ve wasted no time,” Seyffart noted, adding that the updated prospectus underscores Grayscale’s commitment to meeting market demand.

The launch of Grayscale’s Bitcoin ETF options comes in the wake of the firm’s pivotal legal victory over the U.S. Securities and Exchange Commission (SEC) last year.

In August, the U.S. Court of Appeals ordered the SEC to reconsider its denial of Grayscale’s application to convert its Bitcoin Trust into a spot ETF.

The ruling represented a breakthrough in the regulatory landscape, challenging nearly a decade of resistance to crypto ETF approvals.

Spot Bitcoin ETFs See $800M in Inflows

U.S. spot Bitcoin ETFs witnessed a remarkable surge in inflows, with $816.44 million recorded on Nov. 19, marking a 220% increase compared to the previous day.

ARK and 21Shares’ ARKB led the inflows, attracting $267.34 million—the fund’s highest single-day inflow since launch.

Fidelity’s FBTC and BlackRock’s IBIT followed closely, bringing in $256.15 million and $216.12 million, respectively.

Bitwise’s BITB, Grayscale’s GBTC, and VanEck’s HODL added to the momentum, with inflows of $52.75 million, $16.19 million, and $7.9 million.

Total trading volume across these ETFs also soared to $4.78 billion, up from $3.62 billion the previous day.

The contineud interest in Bitcoin ETFs comes as major Bitcoin holders like MicroStrategy and Metaplanet have expanded their Bitcoin holdings.

On Monday, Michael Saylor’s MicroStrategy revealed it has acquired $4.6 billion worth of Bitcoin.

The firm also announced plans to raise an additional $1.75 billion through convertible notes to increase its cryptocurrency holdings.

Likewise, Metaplanet recently announced plans to raise $11.3 million through a third series of ordinary bonds to support its Bitcoin acquisition.

The ongoing macroeconomic uncertainties, characterized by increasing inflationary pressures and geopolitical tensions, have prompted corporate treasurers to explore the inclusion of Bitcoin as a reserve asset.