On 15 April 2025, the US Securities and Exchange Commission (US SEC) published a notice of proposed rulemaking (File No. SR-SAPPHIRE-2025-18) submitted by MIAX Sapphire, LLC, seeking approval to amend Exchange Rule 402 to permit the listing and trading of options on the VanEck Bitcoin Trust. This filing represents a significant step in broadening access to regulated crypto-derivative instruments within the United States and forms part of a competitive response to a contemporaneous application lodged by Cboe Exchange, Inc. The proposal, grounded in the United States Securities Exchange Act of 1934, offers a structured legal justification for expanding options trading to include spot Bitcoin-based exchange-traded funds (ETFs), specifically the VanEck Bitcoin Trust.
MIAX Sapphire seeks to include the Trust under Exchange Rule 402, which sets the “Criteria for Underlying Securities” eligible for options trading. The VanEck Bitcoin Trust, structured as a commodity-based ETF, holds Bitcoin as its principal asset and provides investors with exposure to Bitcoin’s price movements without the complications of direct ownership. The proposed amendment is submitted pursuant to Section 19(b)(1) of the United States Securities Exchange Act of 1934 and Rule 19b-4 thereunder. It draws upon the legal precedent of earlier approvals, such as the US SEC’s accelerated approval of CboeBZX-2023-040, allowing the listing of Bitcoin-based trust shares.
The legal reasoning is rooted in a purposive interpretation of Exchange Rule 402(i), which permits options on ETFs representing interests in investment companies, currency trusts, and commodity pools. The VanEck Bitcoin Trust satisfies Rule 402(i)(5), meeting conditions for creation/redemption rights, net asset value correlation, and share issuance procedures as outlined in its prospectus. The Trust also qualifies as a national market system (NMS) stock under Rule 600 of Regulation NMS, as defined under the United States Securities Exchange Act, thereby fulfilling Exchange Rule 402(a) requirements.
From a quantitative perspective, the Trust exceeds the threshold criteria under Rule 402(b): it has over 49 million shares outstanding, more than 32,000 beneficial holders, and a six-month trading volume exceeding 133 million shares. These metrics surpass the standard numerical benchmarks typically required for underlying securities to qualify for options listing, thereby reinforcing the Exchange’s assertion that the Trust is widely held and actively traded.
The proposed Trust options will be subject to the same listing and trading protocols applicable to all ETF options on the Exchange. They will be American-style, physically settled contracts governed by the Options Clearing Corporation (OCC) rules under Chapters VIII and IX. MIAX Sapphire will open expirations in accordance with Exchange Rule 404—encompassing weekly, monthly, and long-term equity options (LEAPS)—and will adhere to prescribed strike price intervals and minimum tick sizes under Rules 404 and 510.
Position and exercise limits, pursuant to MIAX Rules 307 and 309 (incorporated into the MIAX Sapphire Rulebook), will initially be set at 25,000 contracts. These limits are aligned with other Bitcoin-based ETFs and reflect a conservative approach relative to the Trust’s trading volume and share capitalisation. MIAX Rule 1502 on margin requirements will also govern the Trust options.
Importantly, MIAX Sapphire assures the US SEC that adequate surveillance mechanisms are in place. These include cross-market monitoring through the Intermarket Surveillance Group (ISG), information-sharing agreements with affiliated exchanges (MIAX, MIAX Pearl), and a Regulatory Services Agreement with the Financial Industry Regulatory Authority (FINRA). Drawing from the US SEC’s findings in the January 2024 Bitcoin ETP Approval Order, MIAX Sapphire reinforces the Commission’s conclusion that a high correlation between CME Bitcoin futures and the spot market supports effective surveillance against fraud and manipulation.
The proposal is anchored in the public interest objectives enshrined under Section 6(b)(5) of the United States Securities Exchange Act of 1934. It argues that the listing would help prevent manipulative practices, promote fair and efficient markets, and enhance investor protection by enabling price discovery in a regulated environment rather than through opaque over-the-counter (OTC) options. By transitioning such Bitcoin-related options to the Exchange, the rule change is expected to improve transparency, counterparty reliability, and liquidity.
The US SEC’s invitation for public comments and its decision timeline—ranging from 45 to 90 days—provides an opportunity for market participants to contribute to the regulatory discourse. The application underscores MIAX Sapphire’s view that listing options on the VanEck Bitcoin Trust will foster healthy market competition, especially given that the Exchange already offers options on other commodity-based ETFs, such as gold and silver trusts, under the same legal and procedural framework.
Ultimately, the proposed amendment represents a convergence of crypto-financial innovation and established securities regulation. As the US SEC deliberates on this application, the outcome may shape how digital asset exposure through traditional instruments continues to evolve in United States capital markets.
(Source: https://www.sec.gov/files/rules/sro/sapphire/2025/34-102865.pdf, https://www.sec.gov/newsroom)
