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Asset management firm Valkyrie has applied to US regulators to launch a leveraged bitcoin futures ETF with an interesting ticker symbol.
The Valkyrie Bitcoin Futures Leverage Strategy ETF, which has the ticker symbol ‘BTFD’, will not invest directly in Bitcoin, but will instead invest in the rising price of Bitcoin futures contracts, according to documents filed with the Securities and Exchange Commission on Monday. They are trying to make a profit.
Valkyrie said the fund was designed to be available only to sophisticated investors.
The name BTFD is also known in the cryptocurrency community as “buying the plunge”.
Valkyrie did not immediately respond to a request for comment.
The company issued a warning to those interested in the fund.
“Bitcoin and bitcoin futures contracts are a relatively new asset class and are subject to significant inherent risks, including the risk of a fund’s investment value declining rapidly to zero,” the firm said. “Bitcoin and Bitcoin futures contracts have historically been more volatile than traditional asset classes. You should be prepared to lose your entire investment.”
SEC approves Bitcoin futures ETF for the first time transaction The ProShares Bitcoin Strategy ETF was introduced in October 2021, followed by several other ETFs.
What about Spot Bitcoin ETFs?
This is a little more complicated. The SEC has not approved spot Bitcoin ETFs that track the price of Bitcoin instead of futures.
The approval of a Bitcoin futures ETF, rather than a spot Bitcoin ETF, is particularly contentious. lawsuit Crypto asset management firm Grayscale has filed a lawsuit against the SEC.
For years, Grayscale has been trying to transform its flagship Grayscale Bitcoin Trust Fund into a spot Bitcoin ETF.
In a brief, Grayscale said that the spot price of Bitcoin in both spot and futures ETFs is subject to the same risks, so it makes no sense to approve one product and not the other. claimed.