SEC approves options trading on Ethereum ETFs

On Wednesday, the US Securities and Exchange Commission (SEC) approved the listing and trading of options on certain Ethereum-backed exchange-traded funds (ETFs). These include BlackRock's iShares Ethereum Trust, the Bitwise Ethereum ETF, and Grayscale's Ethereum Trust products. The contracts, which allow buyers to buy or sell ETH at a set price before a specified deadline, were approved following a delayed decision in 2024. Bloomberg's James Seyffart called the verdict “expected.”

According to the agency, Ethereum's price surged 14% in 24 hours, reaching $1,641. This increase was supported by the commission's decision and the 90-day tariff pause announced by US President Donald Trump.

Earlier in 2024, Better Markets expressed concerns about the risks associated with sharp price fluctuations in Ethereum ETFs. The volatility of such instruments could pose challenges for investors. However, the SEC noted that authorizing options trading provides market participants with more cost-effective ways to protect their investments, such as the ability to hedge risks at a lower cost.