Cboe Exchange Joins Ethereum ETF Options Trading Party Now
Published Date: 4/17/2025
Notice
Summary
Cboe Exchange is now letting traders buy and sell options on three popular Ethereum ETFs: Grayscale Ethereum Trust, Grayscale Ethereum Mini Trust, and Bitwise Ethereum ETF. This change means more ways to invest in Ethereum through options, starting right away. Investors and traders can jump in immediately to explore new opportunities with these crypto-related ETFs.
Analyzed Economic Effects
5 provisions identified: 2 benefits, 2 costs, 1 mixed.
Options Now Trade on Ethereum ETFs
Cboe Exchange amended its rules to list and trade options on three Ethereum-backed ETFs: the Grayscale Ethereum Trust ETF, the Grayscale Ethereum Mini Trust ETF, and the Bitwise Ethereum ETF. The Exchange filed the proposal on April 10, 2025 and the change is effective immediately, allowing investors and traders to buy and sell options on these ETFs right away.
25,000-Contract Position Limit Set
The Exchange set a position limit of 25,000 same-side option contracts for each Ethereum Fund option, and the exercise limit for each will be equivalent to that position limit. A 25,000-contract position is effectively equivalent to 2,500,000 underlying ETF shares if all contracts were exercised.
Contract Specs and Listing Cadence Set
Options on the Ethereum Funds will be physically settled American-style. The Exchange may list weekly, monthly, or quarterly series and may list LEAPS that expire from 12 to 180 months. Strike intervals will be $1 or greater when strike price is $200 or less and $5 or greater when over $200. Minimum price increments are $0.05 when the option price is below $3.00 and $0.10 when $3.00 or higher (with penny-interval program exceptions where applicable).
No FLEX Options for These ETFs
The Exchange amended Rule 4.20 to exclude the three Ethereum Funds from being authorized for FLEX (customizable) options trading. That means FLEX-style customizable option contracts will not be available for these ETFs.
Conditions That Can Suspend Option Trading
Options on these ETFs will be subject to the Exchange's continued listing standards and may be suspended or have opening transactions halted if certain events occur. Examples include the Units ceasing to be an NMS stock, trading in the Units being halted on the primary market, the underlying value no longer being calculated or available, or (for Units approved under the creation/redemption standard) having fewer than 50 record/beneficial holders for 30 or more consecutive trading days after the initial 12-month period.
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