Nasdaq Seeks SEC Approval to Lift Bitcoin ETF Options Limits

Nasdaq has submitted a request to the U.S. Securities and Exchange Commission (SEC) to lift trading limits on options tied to several spot Bitcoin and Ethereum ETFs. The change would apply to products such as BlackRock’s iShares Bitcoin Trust (IBIT) and Grayscale’s Bitcoin Trust (GBTC), among others.

Currently, these options are subject to a cap of 25,000 contracts per trader — a restriction designed to limit risk in newly launched or volatile products. Nasdaq’s proposal would either remove these caps or bring them in line with standard position and exercise limits already applied to mainstream ETFs. These often scale based on volume and demand.

In practical terms, approval would mean institutional traders could hold significantly larger options positions on Bitcoin ETFs, potentially improving liquidity and tightening spreads. As Nasdaq noted in its filing, these ETFs now exhibit trading volumes and open interest comparable to large, well-established funds. Applying higher limits would reflect that maturity.

Options are a key part of financial markets, allowing participants to hedge risk or speculate on future price movements. By aligning Bitcoin ETF options with traditional ETF standards, regulators would be signalling increased confidence in the infrastructure and stability of these products.

If the SEC approves the proposal — which remains under review with public comment open — it would further integrate Bitcoin into the broader regulated asset management landscape. Increased trading flexibility may attract additional institutional interest, deepen derivatives markets, and support more efficient price discovery.

However, the core protections of the options market — including surveillance mechanisms and manipulation safeguards — would remain in place. The proposal represents a broadening of access, not a loosening of oversight.

A decision is expected in the coming weeks. Approval would mark another step in Bitcoin’s gradual institutionalisation, reinforcing its place in modern portfolio construction.