Demand is high! Nasdaq proposes to significantly increase the daily trading limit of BlackRock Bitcoin ETF options to 1 million contracts.

Nasdaq's international securities exchange underwriters proposed to increase the daily trading limit for the options of the BlackRock iShares Bitcoin Trust ETF by four times the current limit to address the growing demand from investors. According to a filing from the U.S. Securities and Exchange Commission on Wednesday, the exchange is requesting to raise the current contract daily limit for the IBIT trading fund with the code IBIT from 250,000 contracts to 1 million contracts. The filing states: "The Exchange notes that the proposed IBIT options position and exercise limits are consistent with the existing position and exercise limits for options on iShares MSCI Emerging Markets ETF, iShares China Large Cap ETF, and iShares MSCI EAFE ETF." Tim Sun, senior researcher at Hashkey Group, stated that Nasdaq's request not only reflects the increase in trading volume, but also a deeper transformation in market dynamics. He pointed out that this "indicates a significant demand in the market for hedging, risk management, and more complex strategy construction." This marks the second time Nasdaq has requested an increase in the contract daily limit for IBIT. In January this year, shortly after the ETF options were approved, the exchange sought to raise the limit by ten times to 250,000 contracts due to rapidly accelerating trading activity. The SEC approved this request in July. The largest Bitcoin ETF with assets under management of about $70 billion, IBIT has become a key tool for cryptocurrency option trading since its options were first listed. In October, the open interest of IBIT options surged to over $50 billion, comparable to the size of the largest cryptocurrency options exchange Deribit. Data shows that contracts related to IBIT account for 98% of all Bitcoin ETF options trading, and 96% of the total open interest in contracts. Institutional behavior is driving this transformation. Large investors increasingly rely on regulated products like IBIT to manage their Bitcoin risk exposure. Sun mentioned that JPMorgan Chase submitted an application this week for structured notes linked to IBIT other issuers may follow suit. He said: "It can be reasonably expected that more structured products will adopt IBIT as the underlying asset, which is a natural result of institutions becoming more involved in the Bitcoin market."