So, there is this thing called Grayscale Bitcoin Trust, which is like a big piggy bank where people can put their money to buy bitcoins. Right now, only rich people can do that easily because they have lots of money. But what if normal people also want to invest in bitcoins? They might not have enough money to buy whole bitcoins. That's why Grayscale wants the government to let them create something called "options" on their piggy bank. Options are like special tickets that allow people to buy or sell bitcoins at a certain price in the future, without having to put all the money right away. This way, more people can invest in bitcoins and it will be fair for everyone. Grayscale thinks this idea is good because it will help people know how much bitcoins are worth and also let them protect their money from losing value if bitcoin prices go down. The government needs to say yes or no to this idea, but Grayscale really wants them to say yes. Read from source...

1. The lack of options is not a significant risk management challenge for investors who want to bet on Bitcoin's price direction. There are other ways to hedge, such as using futures contracts, which have been available since 2017 and have proven to be more liquid and efficient than options.
2. Sonnenshein suggests that options would aid in price discovery, but this is a vague and unsubstantiated claim. Options are not necessary for determining the fair value of an asset, especially one as volatile and speculative as Bitcoin. In fact, they could introduce more noise and manipulation into the market, as option traders may try to influence the spot price with their actions.
3. Diversifying the investor base is not a compelling reason to approve options on the Grayscale Bitcoin Trust. The trust already has a large and loyal following of institutional and retail investors who are willing to pay a premium for its shares, which trade at a significant discount to the net asset value (NAV). Adding more investors may dilute the value of existing shareholders, as well as increase the demand-supply imbalance in the market.
4. The article does not address the potential regulatory and operational challenges of creating and trading options on a Bitcoin ETF, such as custody, settlement, reporting, taxation, and surveillance. These are serious concerns that cannot be glossed over or ignored by the SEC or Grayscale.

1. Grayscale Bitcoin Trust (BTC) Common Units of fractional undivided beneficial interest (ARCA:GBTC): BUY with a target price of $35 per share, assuming the SEC approves options trading on GBTC within the next 6 months. This would boost the liquidity and appeal of GBTC, making it more attractive to institutional investors who are looking for exposure to Bitcoin without the hassle of direct ownership or custody issues. The risk is that if the SEC denies the approval, the price of GBTC could drop significantly as a result of reduced demand and increased supply from existing shareholders looking to sell or swap their shares.
2. Bitcoin ETFs: HOLD with a target price of $50 per share for the average Bitcoin ETF, assuming the SEC approves options trading on GBTC within the next 6 months. The reason for this is that the introduction of Bitcoin options would likely lead to increased competition among Bitcoin ETFs, as well as greater differentiation in terms of fees, performance, and risk-adjusted returns. This could benefit investors who are looking for more choice and flexibility in their exposure to Bitcoin. However, the risk is that if the SEC denies the approval or delays it for a long time, the price of Bitcoin ETFs could suffer from lack of demand and increased volatility due to the uncertainty surrounding the regulatory status of GBTC.
3. Crypto assets in general: BUY with a target price of $1 trillion in total market capitalization within the next 2 years, assuming the SEC approves options trading on GBTC within the next 6 months and other global regulators follow suit. The reason for this is that the introduction of Bitcoin options would signal a positive shift in the perception of crypto assets as a legitimate asset class by mainstream investors and authorities, which could boost their adoption, acceptance, and valuation. However, the risk is that if the SEC denies the approval or delays it for a long time, the price of crypto assets could decline due to the continued skepticism and scrutiny from regulators and the public.