SEC Eyes Crypto Chaos: New Rules for Bitcoin ETF Options Trading
Published Date: 4/3/2026
Notice
Summary
BOX Exchange wants to update its rules for special options tied to popular Bitcoin and Ethereum ETFs and trusts. These changes affect traders using FLEX equity options and position limits, aiming to keep things fair and clear as crypto-related products grow. The new rules could impact trading limits and how these options work, with the SEC now asking for public feedback before anything changes.
Analyzed Economic Effects
4 provisions identified: 4 benefits, 0 costs, 0 mixed.
Removes 25,000‑Contract Cap
The Exchange proposes to remove the 25,000 contract position and exercise limit that applied to options on certain crypto funds (Fidelity Wise Origin Bitcoin Fund, ARK21Shares Bitcoin ETF, iShares Ethereum Trust ETF, Fidelity Ethereum Fund, Bitwise Ethereum ETF, Grayscale Ethereum Trust, and Grayscale Ethereum Mini Trust). Those funds would no longer be subject to the special 25,000 contract cap and instead be governed by BOX Rules 3120 (position limits) and 3140 (exercise limits).
Allow FLEX Trading for Additional Crypto ETFs
BOX proposes to permit trading of FLEX Equity Options on the Fidelity Wise Origin Bitcoin Fund, ARK21Shares Bitcoin ETF, iShares Ethereum Trust ETF, Fidelity Ethereum Fund, Bitwise Ethereum ETF, Grayscale Ethereum Trust, and Grayscale Ethereum Mini Trust by removing existing prohibitions in Rule 5055. These crypto funds would be able to trade as FLEX Equity Options like other eligible equities.
Stops Aggregating FLEX with Non‑FLEX Positions
For the iShares Bitcoin Trust ETF, the Grayscale Bitcoin Trust, the Grayscale Bitcoin Mini Trust, and the Bitwise Bitcoin ETF, BOX proposes that FLEX Equity Option positions would no longer be aggregated with positions in non‑FLEX options on the same underlying ETF for purposes of position and exercise limits. BOX also notes that FLEX Equity Options that are physically settled would not be subject to position limits, consistent with treatment of other options.
Treats Rule 5020(h) Crypto Assets Like Other Options
The proposal states that Crypto Assets that qualify for listing under BOX Rule 5020(h) would be subject to BOX Rules 3120 (position limits) and 3140 (exercise limits) and would not be restricted from trading as FLEX Equity Options; they would be treated similarly to other options that meet Rule 5020(h).
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