April 30 - The U.S. Securities and Exchange Commission on Thursday approved a Nasdaq filing that will allow Nasdaq MRX to list and trade a new category of prediction-style options tied to a major benchmark index, according to the commission's order.
The products in question are cash-settled binary options that deliver a set payoff at expiration depending on whether the linked index finishes above or below a pre-specified level. The SEC noted that these contracts would have a "fixed, all-or-nothing exercise settlement amount" of $100 if they expire in the money.
Nasdaq MRX, an electronic U.S. options exchange operated by Nasdaq, plans to initially list options tied to the Nasdaq-100 index and the Nasdaq-100 Micro index. The Nasdaq-100 tracks 100 of the largest non-financial companies listed on Nasdaq, including Apple, Nvidia and Intel. The Nasdaq-100 Micro index represents 1/100th of the full Nasdaq-100 value.
In its order the commission granted accelerated approval to Nasdaq's March application, finding the proposal "consistent with the requirements of the act" and stating it did not raise new regulatory concerns. The approval clears the way for the exchange to begin offering these outcome-focused contracts under the listing terms it proposed.
A Nasdaq spokesperson said, "We welcome the SEC's approval of Nasdaq MRX's proposal to list and trade Outcome-Related Options (OROs) tied to the Nasdaq-100 Index."
Other market operators are also preparing similar products. Cboe Global Markets, a prominent options exchange operator, is pursuing its own "all-or-none" styled contracts linked to financial and economic events and is aiming for a second-quarter launch, subject to regulatory approvals.
The move reflects broader interest among firms in entering regulated prediction market formats, which proponents say can open new revenue channels and provide market insights by letting participants take positions on real-world outcomes within an exchange structure.
What this means for markets
- Regulated options venues are expanding their product sets to include binary, outcome-based contracts.
- The Nasdaq-100 and its Micro counterpart will serve as the initial underlying benchmarks for these listed contracts.
- Other exchanges are pursuing comparable offerings, though their launches remain subject to regulatory clearance.