In general D&D 5E works like option number 2. The following is an excerpt from the D&D 5E SRD.
You can download the SRD here.

Originally Posted by D&D 5E SRD
MATERIAL (M)
Casting some spells requires particular objects,
specified in parentheses in the component entry.
A character can use a component pouch or a
speIlcasting focus (found in chapter 5) in place of
the components specified for a spell. But if a cost is
indicated for a component, a character must have that
specific component before he or she can cast the spell.
If a spell states that a material component is
consumed by the spell, the caster must provide this
component for each casting of the spell.
A spellcaster must have a hand free to access these
components, but it can be the same hand that he or she
uses to perform somatic components.


So I would be ok with option number 2.