Nasdaq has taken a significant step toward mainstreaming digital assets by moving to eliminate position limits on options tied to spot Bitcoin and Ethereum exchange-traded funds. In a rule change filed with the U.S. Securities and Exchange Commission, the exchange announced plans to remove the long-standing 25,000-contract cap on ETF options linked to major crypto funds.
The proposal applies to Bitcoin and Ethereum ETFs issued by leading asset managers including BlackRock, Fidelity, Bitwise, Grayscale, ARK/21Shares, and VanEck. Filed on January 7 and made effective this week, the change brings crypto ETF options in line with the rules already governing other commodity-based exchange-traded products.
In an unusual move, the SEC waived its standard 30-day waiting period, allowing the rule to take effect immediately. However, regulators still retain the authority to suspend the change within 60 days if concerns arise. A public comment period has also been opened, with a final decision expected by late February unless the SEC intervenes.
Options are derivatives that give traders the right—but not the obligation—to buy or sell an underlying asset at a predetermined price before a set expiration date. Exchanges traditionally impose position limits to reduce the risk of excessive speculation, market manipulation, and outsized positions that could destabilize markets. Nasdaq argued that maintaining limits on crypto ETF options created unequal treatment compared to other eligible options products.
According to Nasdaq, the rule change ensures that digital asset options are treated the same as all other qualifying options listed on the exchange, without weakening investor protections. The exchange maintains that removing the cap will support market efficiency, liquidity, and legitimate hedging strategies rather than increase systemic risk.
This move builds on Nasdaq’s earlier approval, granted in late 2025, to list options on single-asset crypto ETFs classified as commodity-based trusts. While that decision allowed Bitcoin and Ethereum ETF options to trade, it left position and exercise limits intact—until now.
Nasdaq has been steadily expanding its footprint in the digital asset space. In November, the exchange proposed increasing position limits on options tied to BlackRock’s iShares Bitcoin Trust from 250,000 contracts to 1 million, citing surging demand and the need for more flexible trading and risk management tools.
The exchange’s broader crypto ambitions go beyond ETFs. Nasdaq’s head of digital assets strategy, Matt Savarese, previously indicated that the company is prioritizing regulatory approval to offer tokenized versions of listed stocks, signaling a deeper push into blockchain-based financial products.
Earlier this month, Nasdaq also partnered with CME Group to unify their crypto benchmarks, rebranding the Nasdaq Crypto Index as the Nasdaq-CME Crypto Index. The index tracks a range of major digital assets, including Bitcoin, Ethereum, XRP, Solana, Chainlink, and Avalanche, reinforcing Nasdaq’s growing role in shaping crypto market infrastructure.
Taken together, the removal of ETF options limits marks another milestone in the integration of cryptocurrencies into traditional financial markets—one that could unlock greater participation from institutional investors while further blurring the line between digital assets and conventional commodities.
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