29 May 2024
The New York Stock Exchange (NYSE) has announced plans to launch financial products tied to the spot price of Bitcoin. The NYSE is collaborating with CoinDesk Indices to develop cash-settled index options that will track the CoinDesk Bitcoin Price Index (XBX).
BREAKING: 🇺🇸 New York Stock Exchange to launch financial products tracking spot #Bitcoin prices. pic.twitter.com/mhPECUZAsW
— Bitcoin Magazine (@BitcoinMagazine) May 29, 2024
The XBX is a real-time spot price index for Bitcoin calculated across major crypto exchanges. It has been operating for over 10 years and is currently the benchmark for $20 billion worth of Bitcoin ETF assets.
By developing options contracts based on the XBX, the NYSE aims to provide investors with a new tool to manage risk as interest in Bitcoin continues growing. The products would be subject to regulatory approval.
NYSE Chief Product Officer Jon Herrick said these new options contracts will give investors “access to an important liquid and transparent risk-management tool” amid surging demand for Bitcoin.
The collaboration brings another major traditional finance player into Bitcoin. The NYSE said it shows the “wide-ranging enthusiasm” for the recent spot bitcoin ETF approvals drawing institutions into the asset class.
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Currently, the CME and a handful of other mainstream entities offer Bitcoin derivatives products. The NYSE entering the mix provides additional credibility and signals growing acceptance of Bitcoin in traditional finance circles.
With $25 trillion in market capitalization, the NYSE brings extensive reach, distribution and influence to the table. Its entrance into Bitcoin indexing and derivatives reflects the asset class going increasingly mainstream in 2024.