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New York Stock Exchange Announces Collaboration to Track Bitcoin Options
The New York Stock Exchange (NYSE) will partner with CoinDesk Market Indexes to launch products that track Bitcoin prices.
This collaboration will create a cash-settled index that will open up new avenues for options trading against Bitcoin. This collaboration will benefit traditional traders and investors who use the CoinDesk Bitcoin Price Index (XBX), the longest-running spot Bitcoin (Bitcoin) index.
“While traditional institutions and everyday investors are demonstrating their broad enthusiasm for the recent approval of bitcoin spot ETFs, the New York Stock Exchange is thrilled to announce its partnership with CoinDesk Indices,” said Jon Herrick, Chief Product Officer , New York Stock Exchange, in Press release. “Following regulatory approval, these options contracts will offer investors access to an important liquid and transparent risk management tool.”
XBX currently tracks the real-time spot price of Bitcoin, in US dollars, across multiple cryptocurrency exchanges. THE NYSE it is the largest stock exchange in the world, with a market capitalization of approximately $39 trillion.
What does this collaboration mean
The collaboration comes at a time of positive sentiment for Bitcoin, with the recent approval of a Spot Bitcoin ETF earlier this year. This signals that the NYSE wants to join the overall cryptocurrency market trend.
A spot Bitcoin ETF allows general investors to quickly gain exposure to Bitcoin without directly purchasing and storing the cryptocurrency using their regular brokerage accounts. A ETFs offers greater liquidity and easier trading during traditional market hours.
This collaboration between NYSE and XBX means that investors can now trade cash-settled options, allowing investors to hedge or speculate on Bitcoin’s price movements.
Options can be complicated, but this arrangement allows traditional Wall Street traders to trade conventional indices without requiring new financial instruments or accounts. In essence, this simplifies the process for investors to manage risk and execute advanced trading strategies.