Key takeaways:
- In the early days of spot Bitcoin ETF trading on regional stock exchanges, ProShares is preparing to introduce a number of Bitcoin ETFs with indirect BTC exposure.
- The daily investing goals of ProShares Plus Bitcoin ETF and ProShares Ultra Bitcoin ETF are to outperform the daily performance of BGCI by 1.5x and 2x, respectively.
In the early days of spot Bitcoin ETF trading on regional stock exchanges, ProShares, a significant Exchange Traded Fund (ETF) issuer in the US, is preparing to introduce a number of Bitcoin ETFs with indirect BTC exposure.
ProShares intends to introduce leveraged and inverse Bitcoin exchange-traded funds (ETFs), according to a filing made on January 16 with the US Securities and Exchange Commission (SEC). Based on the daily performance of the Bloomberg Galaxy Bitcoin Index (BGCI), the ETFs aim to provide daily investing returns from fluctuations in the price of Bitcoin.
The prospectuses for ProShares expressly call for the introduction of five new ETFs that track Bitcoin: Plus Bitcoin ETF, Ultra Bitcoin ETF, UltraShort Bitcoin ETF, Short Bitcoin ETF, and ShortPlus Bitcoin ETF.
The daily investing goals of ProShares Plus Bitcoin ETF and ProShares Ultra Bitcoin ETF are to outperform the daily performance of BGCI by 1.5x and 2x, respectively.
The opposite of the daily performance of the BGCI is used by the other three funds, ProShares UltraShort Bitcoin ETF, ProShares Short Bitcoin ETF, and ProShares ShortPlus Bitcoin ETF, to determine daily investment results.
These are -2x, -1x, and -1.5x, respectively. ProShares emphasized in the filing that the funds do not actively short Bitcoin and that, instead, they aim to profit from drops in the cryptocurrency’s price.
After spot Bitcoin ETFs were introduced in the US, the price of Bitcoin saw a sharp drop, closing at about $43,000. Industry investors, such as Cathie Wood, CEO of ARK Invest, had earlier forecast that a short-term sell-off in the market would probably occur, as some investors would want to take advantage of the good news.
A few days have passed since the US SEC authorized the first 10 spot Bitcoin ETFs on January 10. The first trades were made on January 11. However, ProShares was not among the issuers of the initial batch of spot Bitcoin exchange-traded funds.
With an emphasis on futures-based cryptocurrency ETFs, ProShares launched one of the first Bitcoin futures-linked ETFs in the United States in October 2021.
The company’s flagship Bitcoin futures-based product, the Bitcoin Strategy ETF (BITO), has experienced rapid growth in the last several months and, in January 2024, temporarily exceeded $2 billion in assets under management (AUM).
ProShares presently offers Ether Strategy ETF (EETH), Bitcoin & Ether Equal Weight Strategy ETF (BETE), and Bitcoin & Ether Market Cap Weight Strategy ETF (BETH) in addition to BITO.
