Nasdaq Proposes IBIT Options Limit Increase to 1 Million

Nasdaq has filed a proposal with the U.S. Securities and Exchange Commission to increase the position limits for options on BlackRock's iShares Bitcoin Trust exchange-traded fund, known as IBIT, from 250,000 contracts to 1 million. The move, submitted on November 13, aims to accommodate growing institutional demand for Bitcoin-related derivatives and enhance market liquidity.

The filing reflects surging interest in IBIT options since their approval for trading on the Nasdaq International Securities Exchange last September. Exchange officials stated that the current limits have become restrictive amid rapid growth in trading volume, impeding investors' ability to hedge positions or pursue income-generating strategies effectively. If approved, the change would align IBIT with major equities like Apple and Microsoft in terms of options depth, allowing larger trades without the risk of market manipulation.

Bitcoin advocate Max Keiser described the proposal as a game-changer, stating that the 40-fold expansion removes longstanding barriers for institutional traders. "New ATHs are in play now that the derivatives market has expanded by 40x," Keiser said, referring to potential...