KEY POINTS
- The lawmakers said they wanted to make sure the SEC wasn't discriminating against BTC ETFs
- Some observers have said they believe the CFTC will be a larger hurdle to options instead of the SEC
- The SEC delayed making a decision on spot BTC ETF options and has sought for public comments
Representatives Mike Flood, R-Neb., and Wiley Nickel, D-N.C., are pushing the U.S. Securities and Exchange Commission (SEC) to approve spot Bitcoin exchange-traded fund (ETF) options following the historic approval of spot BTC ETFs in January, a new report revealed.
"We urge you, without delay, to approve options on spot Bitcoin ETPs (exchange-traded products) or to provide an explanation for the Commission's difference in treatment between options for Bitcoin futures ETFs – which are currently trading – and options for the spot Bitcoin ETPs," Flood and Nickel wrote in a letter to SEC Chair Gary Gensler, which was seen by Axios.
The congressmen said they wanted to ensure that the regulatory agency "does not continue to discriminate" against the recently launched funds, adding that the approval of Bitcoin ETFs options trading was "crucial" for the investors that the regulator has repeatedly said it wants to protect.
Flood was among several lawmakers who lauded the SEC's decision to approve spot BTC ETFs. He said it was long overdue, adding that the approval will now give investors greater access to the vast digital assets market. Likewise, Nickel said the decision was a "victory for everyday investors" and the cryptocurrency market's future.
Options for trust-based funds like Bitcoin ETFs are known to have a more difficult process for trading approval due to the various government agencies that should sign off on the products. People close to the matter said they are expecting the Commodity Futures Trading Commission (CFTC) to be more adamant in approving spot BTC ETF options instead of the SEC.
The CFTC is a separate agency from the SEC. Unlike the SEC, which regulates the securities market, the CFTC is mandated to oversee derivatives.
Flood and Nickel's letter came about a week after the SEC delayed a decision on multiple proposals by companies seeking the approval of spot Bitcoin ETFs options. The Wall Street regulator said in a filing that it "seeks and encourages interested persons to provide comments on the proposed rule change." It said it needed "additional analysis of the Proposals' consistency" with securities laws that require "the rules of a national securities exchange be designed to prevent fraudulent and manipulative acts and practices" among other provisions.
There were already comments provided for some of the proposals, the agency said. "Commenters stated the options on spot Bitcoin ETPs would help investors hedge their positions in spot Bitcoin and manage risk," it noted.
The SEC gave interested persons 21 days to submit their written data, views, and arguments on the proposals from exchanges, including Nasdaq ISE, LLC, MIAX International Securities Exchange LLC, and Cboe Exchange, Inc.
Rebuttal comments should be submitted to the regulator within 35 days from the filing's release.
