Bitcoin ETFs like IBIT are approaching the liquidity profile of large-cap tech stocks, signaling broader acceptance of crypto assets in mainstream markets.

This proposal signals the maturation of cryptocurrency markets toward mainstream financial integration and could set a precedent for similar moves in other Bitcoin ETF products if approved.

Nasdaq frames IBIT alongside top-tier equity benchmarks, underscoring Bitcoin’s entry into mainstream institutional markets.

The SEC filing dated November 21, 2025 requests an exemption to eliminate limits entirely for customized, physically delivered FLEX options.

The change aims to address rising demand for IBIT by enabling larger traders to hedge and trade more efficiently, potentially thickening order books and tightening spreads.

Analysts suggest the change could enable larger, lower-risk Bitcoin allocations and may compress volatility over the next six to 18 months.

Removing limits on physically-settled FLEX options would allow tailored Bitcoin exposure through the ETF, enabling larger institutional bets and potential arbitrage opportunities.

FAQ highlights that the increases target IBIT and FLEX options to boost liquidity and institutional demand, with retail investors potentially benefiting from improved liquidity; approval depends on public comments and SEC review, and changes could influence other ETFs if adopted.

Nasdaq ISE filed to raise option position limits for IBIT from 250,000 to 1 million contracts to expand trading capacity and liquidity, and seeks to remove limits on physically-settled FLEX IBIT options.

Nasdaq ISE also proposes a 400% increase in the option contract limit to one million and removal of limits on FLEX IBIT options, signaling stronger institutional involvement in Bitcoin derivatives.

The rationale for the limit increase centers on enabling larger hedging strategies, dampening volatility, and aligning IBIT with other leading asset classes as Bitcoin matures.

Analysts view the move as enabling larger hedging and potentially moderating volatility as IBIT aligns with broader institutional trading norms.