Close Close
Sign In
Newsletters
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards
Podcast Center Video Center Webcasts Resource Center Events
About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing Sitemap Terms of Service Privacy Policy Copyright © 2024 ALM Global, LLC. All Rights Reserved.
ThinkAdvisor
9. Be wary of crypto investments because the sector will continue to be volatile.

Portfolio > Alternative Investments > Cryptocurrencies

Betting Against Bitcoin May Get Easier With Futures ETF Filing

By Katie Greifeld

X
Your article was successfully shared with the contacts you provided.

The firm behind the first U.S. Bitcoin futures ETF wants to launch a product that will bet against the world’s largest cryptocurrency.

The ProShares Short Bitcoin Strategy exchange-traded fund would track the inverse performance of an index of Bitcoin futures, according to Tuesday filing with the U.S. Securities and Exchange Commission.

ProShares introduced the Bitcoin Strategy ETF (ticker BITO) in October, which ranked among the most popular ETF debuts on record.

If approved by regulators, the proposed fund would be the first U.S. ETF betting against the performance of Bitcoin futures.

Rival issuer Direxion filed for a similar strategy in October following BITO’s launch, but pulled the application at the request of the SEC.

Bitcoin performance chart for October 2021 to April 2022

This time around it’s likely that the SEC is more comfortable with the possibility of an inverse futures ETF, according to Bloomberg Intelligence.

“ProShares nailed the SEC’s openness for a futures ETF and so there’s no reason to doubt them here, especially because BITO trading has been fine, it clearly works,” said Eric Balchunas, ETF analyst at BI. “This could mean the SEC is ready to take the next baby step.”

The filing lands with Bitcoin stuck in a rut. The coin is currently trading near $45,000, up from January’s lows near $33,000 but down significantly from November’s highs of almost $69,000.

Short interest as a percentage of shares outstanding on BITO currently stands near 5.5%, down from a record 8% last month, data from IHS Markit Ltd. show.

Fees and a ticker for the proposed offering have yet to be disclosed.

(Image: Adobe Stock)

Copyright 2022 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.