Nasdaq asks SEC to lift 25,000-option limits on Bitcoin and Ether ETF options
Nasdaq has filed rule changes with the U.S. Securities and Exchange Commission to remove the 25,000-contract position and exercise limits on options tied to spot Bitcoin (BTC) and Ether (ETH) exchange-traded funds listed on Nasdaq. The proposal — covering ETFs from issuers including BlackRock, Fidelity, Bitwise, Grayscale, ARK/21Shares and VanEck — was filed in January and became effective immediately after the SEC waived the normal 30-day waiting period; however the SEC can still suspend the change within 60 days and has opened a public comment period with a final decision expected by late February unless further review is required. Nasdaq says the move aligns crypto ETF options with the position-limit regime used for other commodity-based ETFs, remedies an unequal treatment of crypto ETF options, and preserves investor protections. The filing follows prior Nasdaq approvals to list single-asset crypto ETF options and other steps to expand its crypto-market role. For traders, lifting the 25,000 cap could increase options liquidity, enable larger hedges and complex strategies, tighten bid-ask spreads and raise trading volume in crypto ETF options. It also raises concentration and systemic risk if large positions accumulate. Separately, continued institutional accumulation of BTC and ETH reported earlier in January may support medium-term demand for the underlying assets, reinforcing potential bullish pressure while changes to options limits could alter flows and volatility in the near term.
Bullish
Removing the 25,000-contract cap on Bitcoin and Ether ETF options is likely bullish for BTC and ETH prices overall. Increased options position limits typically expand hedging capacity and allow larger institutional and market-maker participation, which can raise liquidity and reduce bid-ask spreads in ETF and related spot markets. That improved liquidity and easier hedging lower transaction costs and make it simpler for institutions to take larger directional exposure to the underlying assets, which supports medium-term demand. The ancillary reports of continued institutional accumulation of BTC and ETH reinforce this constructive backdrop. However, in the short term the rule change could increase options-related flow and gamma-driven volatility; bigger allowed positions also increase concentration risk and potential for larger, abrupt rebalancing events. Net effect: positive demand pressure for BTC and ETH over the medium term (bullish), with possible short-term spikes in volatility and localized risk from large options positions.