Bitcoin Updates: Bitcoin Receives Major-Cap Status as Nasdaq Increases Options Limits Fourfold

Nasdaq Proposes Major Increase in IBIT Options Trading Limits

Nasdaq has submitted a request to regulators to significantly raise the trading cap for options linked to BlackRock’s iShares Bitcoin Trust (IBIT), highlighting the growing acceptance of Bitcoin within mainstream institutional finance. The International Securities Exchange (ISE), operated by Nasdaq, has asked the U.S. Securities and Exchange Commission (SEC) to boost the position and exercise limits for IBIT options from 250,000 contracts to one million.

This proposed change would bring IBIT options in line with other highly liquid exchange-traded funds (ETFs) such as the iShares MSCI Emerging Markets (EEM) and SPDR Gold Trust (GLD), reflecting both the surging demand for Bitcoin-related products and the rapid evolution of IBIT as a financial instrument.

IBIT has experienced remarkable growth over the past year, now holding the top spot for open interest in Bitcoin options—surpassing even long-established crypto derivatives exchanges like Deribit.

Nasdaq pointed to IBIT’s strong trading activity, with an average daily volume of 44.6 million shares as of September 2025 and a market capitalization of $86.2 billion, as key reasons for the proposed increase. The exchange also noted that exercising one million contracts would represent only 0.284% of the total Bitcoin supply, suggesting minimal risk to the broader market.

Industry Reactions and Expected Benefits

The initiative has received broad support from financial professionals. Jeff Park, who leads alpha strategies at Bitwise Asset Management, remarked that the previous 250,000-contract ceiling was insufficient to meet institutional needs. Bloomberg’s senior ETF analyst, Eric Balchunas, described the proposed adjustment as a necessary move to treat Bitcoin on par with major assets like Apple and Microsoft. Vincent Liu from Kronos Research believes that higher limits could narrow bid-ask spreads and enhance market efficiency, paving the way for more advanced hedging and income strategies.

Additional Flexibility for Institutional Investors

Nasdaq’s proposal also includes eliminating position and exercise limits for physically settled FLEX options on IBIT—a feature commonly used by large funds to customize their risk management. This change would align IBIT with commodity ETFs such as GLD, which already benefit from unrestricted trading. The exchange emphasized that this added flexibility is essential for attracting institutional investors, who increasingly view Bitcoin as a valuable tool for diversification and macroeconomic hedging.

Next Steps and Implications

The SEC has opened a public comment period on the proposal, running until December 17, 2025. Should the changes be approved, it would mark a significant milestone in Bitcoin’s integration into institutional portfolios. By expanding access to IBIT options, Nasdaq aims not only to meet current market demand but also to lay the groundwork for future growth, as more institutional participants look to capitalize on Bitcoin’s volatility through structured products and sophisticated investment strategies.