The U.S. Securities and Exchange Commission (SEC) has approved options trading on several spot Ethereum exchange-traded funds (ETFs), including BlackRock’s iShares Ethereum Trust, Grayscale’s Ethereum Trust and Ethereum Mini Trust, and the Bitwise Ethereum ETF. These options will be listed and traded on exchanges such as NYSE American and Nasdaq ISE, following an accelerated approval process. The SEC noted that the rule changes were consistent with the Securities Exchange Act’s requirements, supporting a fair and orderly market.
This development follows the SEC’s earlier approval of options trading on spot Bitcoin ETFs. Investors will now be able to use Ethereum ETF options to manage their risk exposure or gain leveraged positions in the underlying asset without directly holding ETH. The decision may provide additional tools for both retail and institutional investors, potentially increasing participation in Ethereum-based products. Analysts expect the introduction of options to help boost liquidity and improve the price discovery process.
The approval comes almost a year after spot Ethereum ETFs were first launched. BlackRock filed its proposal for the iShares Ethereum Trust in July 2024, and since then, several Ethereum ETFs have entered the market. However, demand has been more muted than for their Bitcoin counterparts. As of April, BlackRock’s ETHA holds $1.8 billion in assets, a significant drop from earlier levels, reflecting broader market trends and investor sentiment.
Following the announcement, the price of Ether rose sharply, reaching around $1,675 after having dropped to nearly $1,400 earlier in the week. Data from CoinMarketCap showed Ether gaining over 14% in 24 hours, coinciding with U.S. President Trump’s decision to pause reciprocal trade tariffs, which may have also boosted investor confidence. The renewed attention on Ethereum comes at a time when traditional financial institutions and crypto platforms are watching regulatory signals closely.
Asset managers are already preparing to launch additional Ethereum-based products, such as covered call and buffer ETFs, and some have filed proposals to include staking features in their Ethereum ETFs. These would allow ETF holders to earn staking rewards from the underlying ETH, although final decisions on those applications are expected in the second half of the year.
The broader regulatory climate around crypto has changed under the Trump administration. The SEC has closed investigations into several major crypto platforms, including Coinbase, Gemini and Uniswap Labs. Meanwhile, Congress is moving forward with legislation focused on digital assets, including the STABLE Act and GENIUS Act, aimed at regulating stablecoin usage and the firms that issue them. While Bitcoin ETFs have seen stronger inflows, the recent approval of Ethereum ETF options may mark a shift in investor interest and broader acceptance of Ethereum as an asset class.
