[Digital Today reporter Chi-gyu Hwang] The U.S. Securities and Exchange Commission will temporarily halt and review its approval of Nasdaq cash-settled bitcoin index options following an objection by CME Group.
According to a recent CoinDesk report, the SEC in May gave conditional approval for Nasdaq PHLX to list cash-settled bitcoin index options under the ticker QBTC.
CME Group in June objected to the SEC approval and argued that because bitcoin is a commodity, options directly linked to its value fall under the exclusive jurisdiction of the Commodity Futures Trading Commission, not the SEC. If CME is right, the SEC has no authority to approve QBTC. Nasdaq would need to register as a futures and swaps exchange regulated by the CFTC, or redesign the contract to track securities such as spot bitcoin exchange-traded funds (ETFs).
CME already operates regulated bitcoin futures and options markets. Nasdaq's QBTC could compete for the same trading demand without registering under the CFTC regulatory framework that CME follows. CME Group also warned that the approval could set a precedent for securities exchanges to list derivatives on other commodities.
Chi-gyu Hwang
delight@d-today.co.kr