The U.S. Securities and Exchange Commission has approved a Cboe Global Markets rule change that would allow binary options linked to key performance indicators at 23 publicly listed U.S. companies, according to CoinDesk. SEC Chair Paul Atkins said in a statement issued on Oct. 13 that the approval covers contracts tied to metrics including Coinbase’s trading volume, Robinhood’s customer numbers and revenue, and MARA Holdings’ Bitcoin production.
The contracts will be cash-settled and structured as European-style options, meaning they can be exercised only at expiration. Settlement data will be drawn from filings submitted to the SEC rather than investor presentation materials or earnings slide decks.
Cboe plans to launch the contracts this month. Robinhood is expected to be the first brokerage to offer the product to retail investors. Trading, however, cannot begin until clearinghouse Cboe Clear U.S. receives temporary registration. A separate related application is also still under review.
The U.S. Securities and Exchange Commission approved a rule change filed by Cboe Global Markets, according to CoinDesk. In a statement issued on Oct. 13, SEC Chair Paul Atkins said the change would allow the listing of binary options tied to key performance indicators, or KPIs, at 23 publicly traded U.S. companies.
Crypto-linked metrics included in the approval cover Coinbase (COIN) trading volume, Robinhood (HOOD) customer numbers and revenue, and MARA Holdings (MARA) Bitcoin production.
Cash-settled contracts with expiration-only exercise
The contracts will be cash-settled and structured as European-style options, which means they can be exercised only at expiration. Settlement data will come from documents the companies file with the SEC, not from earnings presentation materials.
Cboe targets launch this month
Cboe plans to launch the contracts this month. Robinhood is expected to be the first brokerage to make the product available to retail investors.
Trading still cannot begin until clearing agency Cboe Clear U.S. obtains temporary registration. A separate related application remains under review.
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