July 03, 2025

Lead Stories

Trump Trade War Fuels Use of Currency Options as Hedge in Europe
Alice Atkins and Alice Gledhill - Bloomberg
The use of options is growing, with daily volumes surging to a record in early April, as companies seek to shield their business from disruption and uncertainty caused by trade tariffs.
European corporate treasurers increasingly are turning to the options market to hedge currency exposure, a more costly method than typically used, as Donald Trump's trade policies cause bigger-than-usual price swings.
Daily volumes of currency options surged to a record in early April in the aftermath of Trump's "Liberation Day" tariff unveil, according to data from the Depository Trust and Clearing Corp. At BNP Paribas SA, one of Europe's largest banks, corporate sales of FX options have doubled year-over-year in 2025 to an all-time high.
/jlne.ws/3IsML9R

Volatility Gauge Hovers Near Lowest In Four Months on Strong Jobs Data
Bernard Goyder - Bloomberg
The Cboe VIX Index touched its lowest level in more than four months in early trading Thursday, after jobs data showing the US labor market is doing better than expected added to a rally that has pushed stocks to records.
The volatility gauge was at 16.43 as of 10:41 a.m. in New York, as the S&P 500 puhsed higher by 0.8%. Wall Street's fear gauge opened below 16 at the lowest since Feb. 20.
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The Great Bitcoin Power Shift Has Large Holders Dumping 500,000 Coins
Olga Kharif - Bloomberg
The shift from anonymous whales to institutional allocators may help sustain the current market dynamic for an extended period, with some analysts expecting Bitcoin's appreciation to be capped at 10% to 20% a year, making it more of a slow-burn allocation.
A silent transfer of control is reshaping the $2.1 trillion Bitcoin market.
A steady stream of sales by long-time whales - miners, offshore funds and anonymous wallets - is being met almost one-for-one by demand from institutional players like ETFs, corporates and asset managers. The result: Bitcoin is struggling to break out of its record high around $110,000, volatility is evaporating, and its place in the investment landscape is being reshaped.
/jlne.ws/4nymlUo

Bitcoin's Original Appeal Fades With Volatility at 2-Year Low
Kirk Ogunrinde - Bloomberg
With Bitcoin stuck in a narrow trading range for much of the year, one of key attractions of the largest digital currency since its earliest days is waning. A closely-watched measure of price swings known as implied volatility has declined to the lowest level in about two years, according to Deribit's BTC Volatility Index. The guage monitors the 30-day forward-looking annualized expectations of volatility. "Bitcoin is becoming less speculative and more akin to a volatile macro asset," said Michael Longoria, a research analyst at the crypto investment firm GSR.
/jlne.ws/4laKMFI

BlackRock Bitcoin ETF Drives More Revenue Than Its S&P 500 Fund
Isabelle Lee - Bloomberg
At the world's biggest asset manager, a Bitcoin exchange-traded fund now generates more revenue than its signature tracker of the S&P 500 Index. The roughly $75 billion iShares Bitcoin Trust ETF (ticker IBIT) has seen a torrent of cash from institutional and retail investors alike, drawing inflows in all but one of the last 18 months. With an expense ratio of 0.25%, the fund brings in an estimated $187.2 million in annual fees, based on back-of-the-envelope math calculated by Bloomberg as of July 1. That slightly edges out the $187.1 million made by BlackRock's iShares Core S&P 500 ETF (IVV), which is nearly nine times larger at around $624 billion in assets, and charges just 0.03%.
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Exchanges

The Fourth of July Is Close. Here Are the Trading Hours for the Holiday Week.
Mackenzie Tatananni - Barron's
Independence Day is nearly here, and with it comes another market holiday shortly after Juneteenth.
The Fourth of July, which falls on Friday this year, honors American nationhood by commemorating the passage of the Declaration of Independence nearly 250 years ago. It has implications for the stock market, too.
Here's what investors should know about trading hours this week.
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Cboe Global Markets Reports Trading Volume for June 2025
Cboe
Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, today reported June trading volume statistics across its global business lines and provided guidance for selected revenue per contract/net revenue capture metrics for the second quarter of 2025.
The data sheet "Cboe Global Markets Monthly Volume & RPC/Net Revenue Capture Report" contains an overview of certain June trading statistics and market share by business segment, volume in select index products, and RPC/net capture, which is reported on a one-month lag, across business lines.
/jlne.ws/4lvyojo

OpenAI Casts Doubt on Robinhood's New Tokenized Equity Products
Paige Smith - Bloomberg
The tokenized equity offerings have sparked debate about the safety and function of tokenized equities for retail investors, and what those tokens actually represent.
Robinhood Markets Inc. shares fell after OpenAI advised caution to customers taking advantage of the brokerage's offer for access to equity "tokens" for the closely held company led by Sam Altman.
The artificial-intelligence firm said the tokens offered by Robinhood aren't company equity, and that OpenAI neither collaborated on nor endorsed the offering, triggering questions about the tokenization of private-company shares more broadly.
/jlne.ws/4lBGYxa

Intercontinental Exchange Reports June Statistics; Record Q2 total Futures & Options ADV, including records across Global Commodities, Energy and Financials
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of technology and data, today reported June 2025 trading volume and related revenue statistics, which can be viewed on the company's investor relations website at https://ir.theice.com/ir-resources/supplemental-information in the Monthly Statistics Tracking spreadsheet. "The record traded volume across ICE's markets during the first half of 2025 - including record traded volumes across energy and interest rate derivatives - highlights the importance of ICE's benchmark contracts and the deep liquidity these offer to customers. This liquidity increases trading efficiency for all participants, whilst bringing price discovery our customers trust. We thank all of our customers for continuing to choose ICE to hedge their exposure," said Ben Jackson, President of ICE.
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LME Data Highlights: Q2 2025
Mondovisione
LME futures and options average daily volume (ADV) in Q2 2025 reached 733,620 lots, the highest quarterly ADV since Q2 2014. Volumes marginally exceeded ADV in Q2 2024 when new sanctions on Russian metal saw volumes surge to levels close to matching those of Q2 2014. April 2025 was a record month for the LME with ADV reaching 834,580 lots and surpassing the previous record of 831,710 lots seen in April 2018. On 7 April, the LME saw its highest ever daily ADV with 1,478,107 lots traded. Four of the top five LMEselect trading days by volume also occurred in April 2025.
/jlne.ws/44vUNGm

CME Group Completes First Delivery Cycle of Hard Red Spring Wheat Futures
CME Group
CME Group, the world's leading derivatives marketplace, today announced that it has completed its first physical delivery cycle of Hard Red Spring Wheat futures, with 182 contracts delivered on July 1, 2025, the first delivery date since the product's April 14 launch.
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Regulation & Enforcement

The CME Group-Langer class action lawsuit is set to go to trial next week, commencing on Monday, July 7. I have started to get calls about the case again. I have refrained from writing more about this recently, despite a terrible itch to do so. I hope this chapter in the Chicago derivatives markets will pass into history sooner rather than later and that a just decision, or decisions, are delivered. ~JJL

SEC Issues New Crypto ETF Disclosure Rules
DJ Shaw - etf.com
The Securities and Exchange Commission's Division of Corporation Finance issued new guidance Monday detailing disclosure requirements for crypto asset exchange-traded products, marking the regulator's most detailed framework yet for the crypto ETF market. The guidance addresses how federal securities laws apply to crypto ETFs, which are investment products that hold digital assets like Bitcoin or use derivative instruments tied to crypto prices, according to the statement. These products trade on national securities exchanges and are typically structured as trusts.
/jlne.ws/44dHGL9

ESMA selects fairCT as bonds consolidated tape provider; The group, co-ordinated by Ediphy, consists of Google Cloud, UBS, TP ICAP, Cboe Global Markets, FactSet, and Norges Bank Investment Management.
Natasha Cocksedge - The Trade
Ediphy (fairCT) has been selected by the European Securities and Markets Authority to be the first consolidated tape provider (CTP) for bonds in the EU. The decision comes after a six-month application assessment process, with ESMA stating that Ediphy was selected upon meeting all Markets in Financial Instruments Regulation (Mifir) selection criteria and reaching the overall highest award criteria score.
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Technology

Fujitsu to develop ETF trading platform based on TSE's CONNEQTOR and provide it to Australian Securities Exchange
JPX
The Australian Securities Exchange (ASX), the Tokyo Stock Exchange, Inc. (TSE), and Fujitsu Limited on June 2, 2025 signed a Memorandum of Understanding (MOU) to develop a SaaS-based Request for Quote (RFQ) platform. Fujitsu will develop the platform based on "CONNEQTOR," an RFQ platform for the ETF market developed by TSE and Fujitsu, and provide it to ASX.
/jlne.ws/4lbFEBa

Strategy

Don't Try to Time the Market. Use This Options Strategy Instead.
Steven M. Sears - Barron's
It's one of the few certainties in the investment universe: Blue-chip stock indexes rise over time.
No special expertise is needed to benefit from that Gulf Stream of prosperity. It's available to anyone who consistently invests during good and bad times. Anyone who accepts that fact-and commits to it during good times and especially bad times-will achieve investment returns that rival those of almost all fund managers.
/jlne.ws/4eItgGv

ETFs That Let You Invest in the Future; Attempting to emulate Cathie Wood's ARKK ETF, some issuers are hoping to attract investors looking for the next big idea. (podcast)
Eric Balchunas - Bloomberg
You just might be able to experience the financial future today. A recent trend in investing has exchange-traded fund issuers creating funds focused on futuristic themes like humanoid robots, alien technology and quantum computing. The hope is to attract investors looking for the next big idea. But needless to say, not all of them will pan out-remember Mark Zuckerberg's metaverse?
/jlne.ws/40BpGbl

Interest Rates Volatility With Nancy Davis: All Options Considered
Bloomberg (Podcast)
Rates volatility has compressed with the Fed on hold and mean reversion of yields but exhibited significant volatility in the first half of the year. In this edition of the All Options Considered podcast, BI's Chief Global Derivatives Strategist Tanvir Sandhu is joined by Nancy Davis, Founder of Quadratic Capital Management. They discuss the dynamics of rates volatility and reliability of portfolio diversifies. All Options Considered is part of the FICC Focus podcast.
/jlne.ws/3Gn4bUY