First Leveraged Bitcoin Futures ETF Launches On June 27 As ETF Fever Rises
Key Takeaways:
The first leveraged-Bitcoin futures ETF is set to launch on June 24.
Bitcoin ETFs have attracted investor attention recently.
NEW DELHI (CoinChapter.com) — Bitcoin Exchange-Traded Funds (ETFs) have recently attracted much attention from investors. Adding to the hype, the US Securities and Exchange Commission recently approved Volatility Shares’ 2x Bitcoin Strategy ETF (BITX), which launched on June 27.
BITX became the first Bitcoin-leveraged futures ETF to receive a nod from the US SEC. The fund launched on the Chicago Board Options (CBOE) BZX Exchange.
In detail, the BITX would be a leveraged ETF, which would use debts or derivatives as leverage to amplify the returns of a benchmark index. The Volatility Shares ETF would leverage Bitcoin Futures contracts, according to its SEC filing.
The Fund is an exchange-traded fund (“ETF”) that seeks to achieve its investment objective by investing its assets principally in cash-settled bitcoin futures contracts that trade only on an exchange registered with the Commodity Futures Trading Commission
Volatility Shares stated in its SEC filing.
Several crypto investors welcomed the news, with one user speculating if the SEC approval meant the regulatory body changed its stance due to political pressure.
However, Nate Geraci, ETFStore president, did not welcome the news. Geraci stated that the launch of a futures ETF before a spot one was “ridiculous.”
Meanwhile, Eric Balchunas, senior ETF analyst at Bloomberg, shared that BITX witnessed $5.5 million in trade volume on the day of its launch. Interestingly, the BITX ETF saw over $500,000 in trading within 15 mins of launch.
The analyst had speculated that the volume would likely reach $6 million as the day progressed.
Bitcoin ETFs Are All The Craze
Institutional investors have shown increased interest in Bitcoin ETFs. Exchange-traded funds allow investors exposure to underlying assets without owning them directly. BTC has two main types of ETFs, Bitcoin futures and Bitcoin spot.
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Several investment firms have shown interest in providing ETF services to customers.
For example, HSBC announced that it would allow its customers to trade Bitcoin and Ethereum ETFs listed on the Hong Kong exchange, crypto journalist Colin Wu noted in a Twitter post. The decision made HSBC the first bank in Hong Kong to offer these services.
Moreover, Bloomberg ETF analyst Eric Balchunas observed a surge in inflows to the ProShares Bitcoin Strategy ETF (BITO). The ProShares ETF was the first BTC-linked fund in the US and remains popular among investors.
Furthermore, rumors of investment firm Fidelity’s interest in a BTC spot ETF surfaced parallel with the BlackRock filing, the largest global asset manager with over $9 trillion under its wing.
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Filed under: Bitcoin - @ June 28, 2023 1:57 am