ETH Back in Play: SEC Approves Options Trading on Ethereum ETFs
The SEC approved options trading for spot Ethereum ETFs from BlackRock, Bitwise, and Grayscale. Institutional investors now have a new way to hedge risk using publicly listed funds.
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The U.S. Securities and Exchange Commission (SEC) gave the green light to options trading for spot Ethereum ETFs.
Specifically, the approval covers options trading for several major funds:
- iShares Ethereum Trust by BlackRock
- Bitwise Ethereum ETF
- Grayscale Ethereum ETF
This decision gives investors more tools to hedge risks and use leverage when working with digital assets.
Options help investors respond quickly to market shifts and manage the risks that come with crypto’s volatility.
Related: What are crypto options?
The SEC’s approval of spot Ethereum ETFs nearly a year ago set the stage for this next move. With options now in play, additional tools can support the market’s continued growth.
SEC Decision Details
The regulator approved options trading for the iShares Ethereum Trust, filed through Nasdaq ISE, under an accelerated process. It also supported proposals from NYSE American LLC to list options on the Bitwise Ethereum ETF, Grayscale Ethereum Trust, and Grayscale Ethereum Mini Trust. Moreover, SEC documents state that the rule changes comply with current regulations, including Section 6(b)(5) of the Securities Exchange Act.
Expanding options trading gives investors more than just access to the asset; it lets them apply hedging strategies. This could also encourage the creation of new investment products, including ETFs that use covered call strategies.
Related: Ethereum Developers Target May 7 for Pectra Mainnet Launch
Market Impact and Outlook
ETH has seen sharp price swings over the past few days. After dipping to around $1,400, the asset bounced back to $1,650.
Yesterday’s market boost came from news of a 90-day pause on U.S. tariff measures. Today’s approval of options trading on Ethereum ETFs could help keep the momentum going and support growing optimism around Ethereum.
Related: ETH Sell-Off Sparks Concern as DeFi Activity Dips Amid Trump’s Tariff Hikes
The introduction of options contracts typically boosts market liquidity for the asset and gives investors more flexibility in managing risk.
Moreover, there’s also growing potential for staking mechanisms to be added to Ethereum ETFs. This would let funds earn additional income from their ETH holdings.
Respected Bloomberg analyst James Seyffart pointed out that staking approval could arrive fairly soon (by the end of October 2025). That timeline opens the door for new investment strategies.
The SEC’s decision is part of a broader push to modernize the crypto market. It follows last year’s approval of spot Bitcoin ETFs. By expanding the range of investment tools, the SEC is giving investors more ways to manage their portfolios without needing to hold crypto assets directly.
Related: U.S. Senate Officially Appoints Paul Atkins as SEC Chairman
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