Alex Perry’s Optionstopia” takes a look at this week’s options news highlights: NYSE Wants to Be A Marketplace for NFTs; SOFR Options Set Records; BlockFi to Pay $100 Million in Penalties

Alex Perry Author John Lothian News

ALEX PERRY

 Associate Editor

Alex Perry is an Associate Editor with John Lothian News with a primary portfolio of contributing to the options-centric video series The Spread and options related news.

Alex Perry’s Optionstopia 

“Alex Perry’s Optionstopia” takes a look at this week’s options news highlights: Ethereum’s Daily Options Volume Matches Bitcoin; Crypto Exchanges Airing Super Bowl Commercials; Cboe’s MATCHNow Technology Migration

Options News Script

This week… the New York Stock Exchange has its eye on NFT’s, SOFR options volumes set records, and BlockFi faces major penalties.

This is Alex Perry with John Lothian News, and this is your recap of options news from the week. Here’s some of the week’s top stories, starting with NFT’s:

NYSE Wants to Be Marketplace for NFTs Just Like With Stocks

Crystal Kim – Bloomberg

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NFTs might just have a new home with the New York Stock Exchange (NYSE). This week, in a regulatory filing with the U.S. Patent and Trademark Office, the exchange indicated plans to produce an NYSE-branded cryptocurrency and a marketplace to buy, sell and trade non-fungible tokens (NFTs). Bloomberg reports that the NYSE wants to do for the increasingly popular NFTs…what it does for stocks. Last year, the New York Stock Exchange produced its first NFTs, which were centered around initial public offerings of companies including Spotify and Roblox Corp. And just a friendly reminder that the New York Stock Exchange will be closed on February 21 in observance of Presidents’ Day.

Tom Greene celebrates 50 years on Wall Street at New York Stock Exchange

Speaking of the New York Stock Exchange, Tom Greene, the head of NYSE trading floors and Vice President of Building Operations is celebrating 50 years on Wall Street. To learn more about how Greene worked his way up the corporate ladder, check out our exclusive interview with him on right here, on John Lothian News.  

SOFR Options Market Catches Fire With $100 Million Wager

Edward Bolingbroke – Bloomberg

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SOFR Futures and Options Set Multiple Records on February 10 as SOFR-Based Liquidity Continues to Grow

CME Group

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It’s been an interesting week in the world of SOFR options. Bloomberg says that when it comes to the Secured Overnight Financing Rate (SOFR), nearly $100 million was spent between Friday and Monday on a straddle, or a long volatility structure “involving the purchase of calls and puts with the same strike.” Bloomberg also notes that “The position grew to 40,000 contracts Monday, after open-interest data revealed Friday’s activity as setting new risk.” The CME announced that SOFR trading has set some records, with over 2 million SOFR futures contracts traded, and a record 130,200 SOFR options contracts traded on February 10.

CME Group Announces Record Soybean Options Volume, Record European Agricultural Volume on February 10

CME Group

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But the records don’t end there, because last week, the CME Group also announced record volume in soybean options. The exchange revealed that a record 290,000 soybean options contracts were traded on February 10, 2022, which the exchange says beat the previous record of over 280,000 options on May 10, 2016.

BlockFi Agrees to Pay $100 Million in Penalties and Pursue Registration of its Crypto Lending Product

Company also agrees to attempt to bring its business into compliance with the Investment Company Act of 1940 within 60 days

SEC

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SOFR wasn’t the only story with $100 million on the table, as the crypto platform BlockFi made headlines this week with its agreement to pay $100 million in fines  – $50 million to the SEC and $50 million to 32 states. The SEC announced that it charged Blockfi for “failing to register the offers and sales of its retail crypto lending product.” But the SEC was not done with BlockFi yet, because the regulator also charged the firm with “violating the registration provisions of the Investment Company Act of 1940.” According to the Financial Times, this is the first enforcement action regulators have taken on crypto lending. While crypto lending is considered a secured loan, it can be quite risky and volatile, which could even lead to a margin call with the borrower having to offer even more crypto to meet the original value of the loan.

BMO Commits $78 Million to Lending to Black-Owned Businesses

Kevin Orland – Bloomberg

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And lastly, the Bank of Montreal (BMO) wants to literally lend a helping hand by committing $78 million to Black-owned businesses. Through an initiative called “Business Within Reach: BMO for Black Entrepreneurs,” Black entrepreneurs and business owners can get thousands of dollars in loans. But not only that, Bloomberg reports that the financial group wants to put more minorities in leadership positions by “increasing the proportion of Black employees in senior leadership roles … to 7% in the U.S. and boosting Black and Latino interns and entry-level employees to 30% in the U.S.” The bank’s efforts are intended to help youth who are Black, Indigenous or people of color.

That’s all for now, but be sure to tune in for this week’s edition of John’s Take. Also, be sure to check out a previous “Options Term of the Week.” Just a friendly reminder that the FIA’s International Futures Industry Conference is fast approaching. The conference will be held March 15-17 in Boca Raton, FL.

THIS HAS BEEN ALEX PERRY FOR JLN. THANKS, AND WE’LL SEE YOU NEXT TIME. 

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THIS WEEK’S VIDEOS

John Vaile Saw the Potential of Financial Futures and Helped Make Them A Success

John Vaile Saw the Potential of Financial Futures and Helped Make Them A Success

John Vaile had an aunt who invested in the stock market who bought Vaile some stock when he was 10 years old and that experience caused him to want to be a stockbroker. As a result, Vaile became a student of the market.

He went to a couple of different colleges in Illinois, then ended up in a program at Wharton for students who did not graduate from college. 

Vaile was working for Morgan Stanley and living in Lake Geneva, WI, surrounded by friends in the futures markets and he wanted to get involved with what was happening. He said he badgered Morgan Stanley to get involved. They gave him permission, but he said he could see how long it would take for them to truly become involved and he did not have the patience for that.

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