The U.S. Securities and Exchange Commission (SEC) has formally begun reviewing a proposal from the Cboe Options Exchange (CBOE) to adjust the minimum price increments, or tick sizes, for options tied to the Mini Bitcoin U.S. ETF Index (MBTX). The review process, announced by the SEC, will determine whether to approve or reject the technical market structure change.
The proposal, submitted by CBOE in late September 2024, seeks to set a tick size of $0.01 for MBTX options priced below $3, and $0.05 for those at $3 or higher. This adjustment aims to align the derivatives product more closely with the pricing granularity of the underlying spot Bitcoin ETFs, specifically referencing BlackRock's iShares Bitcoin Trust (IBIT), which already uses $0.01 increments.
The SEC stated it will evaluate whether the proposal complies with the Securities Exchange Act, focusing on requirements to prevent manipulation, promote fair trade, and protect investors. The commission has opened the proposal for public comment, with a deadline for submissions set for January 21, 2026.
Market analysts view the potential change as a positive step for market efficiency. Finer tick sizes typically lead to tighter bid-ask spreads, which can reduce trading costs, especially for retail investors, and improve price discovery. However, some experts caution that such changes can increase system message traffic and compress market maker profits.
The SEC's review is seen as a technical, operational decision rather than a major policy shift, but it represents another step in the maturation and integration of cryptocurrency-linked products into traditional financial markets. A decision is anticipated by early 2025, following the standard 45 to 90-day review timeline for non-controversial changes.
