SEC Approves Binary Options on COIN, HOOD, and MARA
Cboe wants to list the contracts this month; Robinhood could be the first to offer them, while the SEC and CFTC keep guarding their lines of oversight.
Key Takeaways
- The SEC has approved binary options tied to the performance of 23 publicly traded companies, including Coinbase, Robinhood, and MARA Holdings.
- The contracts are cash-settled, European-style, and are settled based on the companies' SEC filings.
- For crypto, this matters because Coinbase, MARA, and Robinhood are closely tied to the crypto market.
The U.S. market watchdog SEC has approved a new category of binary options tied to performance metrics from 23 publicly traded companies, including Coinbase, Robinhood, and MARA Holdings. For crypto traders, that means another way to bet on crypto-related companies without having to trade directly on the Bitcoin price.
New Contracts for Company Data
The contracts are meant to be yes-or-no instruments. That means investors can, for example, bet on whether Coinbase's trading volume reaches a certain level, or whether Robinhood reports a preset amount of revenue or customer growth.
According to the SEC, the contracts are cash-settled and European-style. That means they can only be exercised on the expiration date. Settlement is based on figures from the companies' SEC reports, not on numbers from earnings presentations.
Cboe Global Markets has filed the rule change and wants to list the contracts later this month. Robinhood is expected to be the first broker to offer the products to retail investors, although trading can only begin after Cboe Clear U.S. receives temporary registration.
Why This Matters for Crypto
For the crypto market, the main point is that some of the new contracts are tied to companies closely linked to crypto. Coinbase and MARA are directly sensitive to activity around Bitcoin and broader crypto trading, while Robinhood is an important gateway to that market for many retail investors.
At the same time, the SEC stressed that this approval does not apply to similar contracts under CFTC oversight, such as those on prediction market platform Kalshi. That shows the line between SEC and CFTC oversight still matters, even as both regulators see more room for innovation and cooperation according to Atkins.
Bitcoin Holds Support
The news came as traders this week were mainly watching Bitcoin, which stayed above $80,000 (€71,400) after key U.S. inflation data. According to the supplied market update, Bitcoin also held above its 50-day moving average around $82,583.92 (€73,700) this week, after briefly dipping below that level on Thursday and then recovering.
That combination of a strong Bitcoin price and new derivatives on crypto-related stocks makes it clear that the market is not just looking at spot prices, but also at products that make it possible to trade the performance of companies around crypto. That fits into a broader trend where crypto event contracts are becoming more important than sports-related markets for platforms like Robinhood.
