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SEC approves binary options on company performance metrics

SEC approves binary options on company performance metrics

Rule Changes

Cboe Clear U.S. wins temporary SEC registration; Robinhood still plans to distribute contracts on Coinbase, Nvidia, Tesla and 20 other firms

November 3rd, 2026: MIAX files for binary options on indexes and company KPIs

Overview

Updated 7 days ago

The Securities and Exchange Commission (SEC) approved Cboe's plan to list binary options tied to company performance metrics on October 13. Each contract pays a flat $1 if a reported metric clears a set threshold and expires worthless if it does not.

On October 27, the SEC published an order granting Cboe Clear U.S. an 18-month temporary registration to clear the contracts, removing the main obstacle to trading. In late October, the Commodity Futures Trading Commission (CFTC) approved a similar Tesla earnings contract as a swap, and MIAX Options filed on November 3 to list binary options on indexes and company metrics. Cboe has not announced a launch date.

Why it matters

Investors can now bet directly on a company's reported operating numbers — revenue, production, user counts — instead of only on its share price.

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Key Indicators

23
Companies with listed metrics
Includes Coinbase, Robinhood, Nvidia, Tesla and MARA.
100+
Metrics Cboe plans to list
Operating and financial figures drawn from issuer SEC filings.
$1
Fixed payout per contract
A call pays $1 if the metric meets or beats the strike; a put pays $1 if it falls short.
18 months
Temporary clearing registration
SEC order published October 27, 2026, lets Cboe Clear U.S. clear the contracts.

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People Involved

Paul S. Atkins
Paul S. Atkins
SEC chair
Led the commission that approved the rule

Organizations Involved

U.S. Securities and Exchange Commission
U.S. Securities and Exchange Commission
Federal regulator
Approved the rule change and Cboe Clear's temporary registration

The federal regulator that oversees securities exchanges and approved Cboe's proposal.
Cboe Global Markets
Cboe Global Markets
Public Company
Cleared to list after Cboe Clear U.S. won temporary registration; launch date not announced

The exchange that filed the rule change and will list the contracts once clearing approval lands.
Robinhood Markets
Robinhood Markets
Retail brokerage
First broker expected to distribute the contracts

Plans to offer the new options to retail investors with no trading fees through 2026.
CC
Cboe Clear U.S.
Clearinghouse
Received an 18-month temporary SEC clearing registration

The clearing agency that received temporary SEC registration on October 27, clearing the main hurdle to launch.

Timeline

October 2026 November 2026

8 events Latest: November 3rd, 2026 · 1 week ago
Tap a bar to jump to that date

  1. MIAX files for binary options on indexes and company KPIs

    Latest Filing

    MIAX Options submitted two proposed rule changes to the SEC to list binary options on indexes and company performance metrics.

  2. SEC publishes order granting Cboe Clear temporary registration

    Regulatory

    The SEC granted Cboe Clear U.S. an 18-month temporary registration to clear binary KPI options; the order was published in the Federal Register.

  3. Federal Register publishes approval notice

    Regulatory

    The official notice details the rule change and the metrics covered; media report the plan widely.

  4. SEC approves Cboe binary KPI options rule

    Regulatory

    The commission clears Cboe to list binary options on company performance metrics across 23 issuers.

  5. SEC opens Cboe Clear amendment for comment

    Regulatory

    Public comments on the clearinghouse amendment are due October 30.

  6. Cboe Clear U.S. amends registration application

    Filing

    The clearinghouse updated its registration, a step required before the new options can trade.

  7. FINRA extends options rulebook to binary KPI contracts

    Regulatory

    FINRA extended its options rulebook to cover binary options on company metrics and contracts cleared by a clearing agency other than OCC.

  8. CFTC approves Tesla earnings contract as swap

    Regulatory

    The CFTC approved Rothera's binary contract on Tesla's fourth-quarter 2026 adjusted EPS and classified it as a swap, opening a parallel route for company KPI event contracts.

Scenarios

1

Cboe launches binary KPI options after clearing registration

Likely Resolves by End of 2026

Discussed by: Cboe, which projected an October rollout; Robinhood, which plans to distribute the contracts

Cboe Clear U.S. receives its provisional registration and the products go live. Robinhood offers them to retail customers with fees waived through December 31, 2026. Trading operates within the existing options framework under exchange surveillance.

2

Binary KPI options stay a niche product

Possible Resolves by Q2 2027

Discussed by: Legal analysis of retail demand in the National Law Review

The contracts launch but attract modest volume. Retail availability depends on each broker's decision to offer them, and the all-or-nothing payout may limit appeal to casual option traders. The products remain a small slice of Cboe's activity.

3

More exchanges and metrics win approval

Possible Resolves by End of 2027

Discussed by: SEC Chair Paul Atkins, who cited a new spirit of harmonization with the CFTC

Other exchanges file similar proposals, and the SEC approves expansions to more companies and metrics. At the same time, the SEC's order leaves CFTC jurisdiction over differently structured contracts open, raising the question of how closely related event products will be regulated.

4

SEC and CFTC routes both trade company KPI contracts

Possible Resolves by Jan 31, 2027

Discussed by: CFTC approval of Rothera's Tesla earnings swap; The Midpoint

The CFTC approved a Rothera binary contract on Tesla's fourth-quarter 2026 adjusted EPS and classified it as a swap. The SEC approved Cboe's KPI options as securities options. Both regulators now say the same company metric can trade under either regime, depending on how the contract is structured.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

Prior to 2026

Cboe's existing binary index options (established before 2026)

Cboe already listed binary options on broad-based indexes and its Cboe Magnificent 10 Index, giving the exchange a working framework for all-or-nothing payouts. The new approval extends that framework from market indexes to company-specific operating metrics.

Then

The exchange had a tested infrastructure for binary contracts, easing the new listing.

Now

The precedent established that binary options can trade on an exchange under securities rules, paving the way for KPI-linked versions.

Why this matters now

The new products reuse Cboe's existing binary options framework, just applied to individual company financial and operating metrics rather than index levels.

September 2024

Kalshi v. CFTC and event contracts (2024)

A federal court in Washington ruled that Kalshi could list event contracts on which party would control Congress, over CFTC objections. The decision opened the door to regulated exchange trading of prediction-market-style contracts on real-world outcomes.

Then

Kalshi listed the congressional control contracts and event-based trading reached a wider retail audience.

Now

The ruling normalized event contracts as exchange-traded products and put pressure on both the CFTC and SEC to clarify how such products fit within existing frameworks.

Why this matters now

Binary KPI options are the securities-market counterpart to CFTC-supervised event contracts, giving investors a regulated way to bet on specific corporate outcomes.

Sources

(10)
+4
U.S. Securities and Exchange Commission Federal Register CoinDesk Crypto Briefing National Law Review TokenPost The Midpoint Securities.io Gate News Markets Media