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SEC Seeks Public Input on Nasdaq's Proposal for BlackRock Bitcoin ETF Options Trading
The Securities and Exchange Commission (SEC) is seeking public feedback on Nasdaq's proposal to enable options trading on BlackRock's spot Bitcoin ETF. This 21-day comment period, as announced in a recent filing, reflects a potentially accelerated approach by the SEC towards crypto-related financial products. The proposal specifically aims to amend certain criteria to list and trade options on the iShares Bitcoin Trust. Bloomberg Intelligence ETF research analyst James Seyffart noted the SEC's unusually swift response to this proposal, suggesting that options trading on the ETF could be approved as early as the end of February. This development follows the recent SEC approval of BlackRock's iShares Bitcoin Trust, which experienced significant inflows shortly after its listing. Additionally, major firms including BlackRock and Fidelity are competing to launch a spot Ethereum ETF, with the SEC recently extending its decision deadline on Fidelity's proposal to March. Fidelity's application emphasized a court ruling criticizing the SEC's inconsistent stance on rejecting spot crypto ETFs while approving futures-based products.
Tokenized Securities Provider Ondo Finance Announces APAC Expansion
Ondo Finance, a U.S.-based issuer of tokenized securities, has expanded its global presence by opening its first office in the Asia Pacific region. The company, capturing nearly 40% of the global market share for tokenized securities, offers three products — OUSG, OMMF, and USDY — which provide exposure to U.S. asset classes like U.S. Treasuries and money market funds. Nathan Allman, Ondo's founder and CEO, highlights the active crypto community and interest in U.S. assets in the Asia Pacific as key drivers for this expansion. Ashwin Khosa, previously with Tether and Bitfinex, has been appointed as the Vice President of Business Development for the APAC region. Recently, Ondo launched USDY, a tokenized note backed by U.S. Treasuries and bank deposits, and introduced it on the Solana blockchain. The specific location of the new APAC office was not disclosed in their statement, and Ondo has not yet responded to requests for further comments.
Terraform Labs Declares Bankruptcy in Delaware
Terraform Labs Pte., the company behind the collapsed stablecoin TerraUSD, has filed for Chapter 11 bankruptcy in Delaware, as per documents filed on January 21. The cryptocurrency firm reported assets and liabilities each estimated between $100 to $500 million. This filing follows the May 2022 collapse of TerraUSD and its associated LUNA token, which resulted in significant investor losses. The bankruptcy process aims to facilitate Terraform Labs' business operations amidst ongoing legal challenges, including representative litigation in Singapore and a lawsuit in the U.S. by the Securities and Exchange Commission (SEC) related to the TerraUSD collapse. The company's list of unsecured creditors includes TQ Ventures and Standard Crypto, prominent digital and venture funds. Additionally, Terraform Labs and its founder, Do Kwon, face a class action lawsuit in Singapore and recently lost a U.S. case, where a judge ruled that LUNA and MIR tokens are securities.
Trading Desk Insights
Bitcoin has consistently traded below its 50-day moving average since Thursday, indicating a bearish trend. Technical analysis suggests a potential continuation towards $38,000 as long as prices remain below $43,500, coinciding with the 20-week moving average, providing short-term support.
Despite the recent price breakdown, open interest has rebounded to Friday levels. While liquidations surged by over 300% to $170 million in the last 24 hours, no major news has emerged. Altcoins have shown underperformance, likely due to market participants reducing exposure.
Bitcoin's implied volatility peaked with the introduction of U.S. spot ETFs last week, dropping below realized volatility. This has increased demand for calls at $45,000 and $46,000 strikes during North American trading hours on Thursday.
Despite inflows into new funds from BlackRock and Fidelity, over $1 billion worth of Bitcoin has been withdrawn from GBTC. FTX's bankruptcy estate selling 22 million shares contributed significantly to the exodus.
On a positive note, Bitcoin has surpassed Silver in the ETF market, ranking second only to Gold among commodities. Notably, several ETFs reached $1 billion in assets at remarkable speeds:
BITO: 2 days
GLD: 3 days
IBIT: 4 days
FBTC: 5 days
Stock futures rose on Monday, building on the S&P 500's all-time high from Friday, confirming Wall Street's bull market since October 2022. Traders now estimate a 46% chance of a Fed rate cut in March, a notable decrease from almost 81% the previous week. UBS predicts gold prices may close the year up to 10% higher, emphasizing the impact of the Fed's policy pivot.
In other developments, Ron DeSantis has withdrawn from the 2024 presidential race, endorsing Donald Trump.
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Disclaimer
This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. The price of crypto assets may rise or fall because of changes in the broad market or changes in a company's financial condition, sometimes rapidly or unpredictably. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives, if any, referred to in this research.
The information on which the analysis is based has been obtained from sources believed to be reliable such as, for example, the company’s financial statements filed with a regulator, company website, company white paper, pitchbook and any other sources. While Secure Digital Markets has obtained data, statistics, and information from sources it believes to be reliable, it does not perform an audit or seek independent verification of any of the data, statistics, and information it receives.
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Crypto and/or digital currencies involve substantial risk, are speculative in nature and may not perform as expected. Many digital currency platforms are not subject to regulatory supervision, unlike regulated exchanges. Some platforms may commingle customer assets in shared accounts and provide inadequate custody, which may affect whether or how investors can withdraw their currency and/or subject them to money laundering. Digital currencies may be vulnerable to hacks and cyber fraud as well as significant volatility and price swings.
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