- Valkyrie has launched a new leveraged Bitcoin futures ETF that aims to provide 2x the daily returns of CME Bitcoin futures contracts. This expands Valkyrie’s offerings in the crypto space.
- Leveraged ETFs like this amplify potential gains but also losses. Factors like Bitcoin’s volatility and daily rebalancing can lead to major price swings. Investors should assess their risk tolerance.
- The ETF invests in Bitcoin futures to target 2x the return of a CME Bitcoin futures index. Leverage comes from the fund’s use of debt and derivatives to multiply exposure to price movements.
On February 22, Valkyrie launched a new Bitcoin futures exchange-traded fund (ETF) designed to deliver double the daily returns of CME Bitcoin futures contracts. This leveraged product provides a way for investors to amplify their exposure to Bitcoin price fluctuations.
Valkyrie Expands Offerings with Leveraged ETF
The Valkyrie Bitcoin Futures Leveraged Strategy ETF joins the company’s existing Bitcoin ETF, the Valkyrie Bitcoin Fund. “The launch of BTFX represents our commitment to bringing investors innovative options for accessing Bitcoin and the digital asset ecosystem as a whole,” said Valkyrie CEO Leah Wald.
Understanding the Risks
Because they use leverage, these ETFs offer the potential for amplified gains but also major losses. Factors like Bitcoin’s volatility, daily rebalancing, and market disruptions could cause substantial price swings. Investors should thoroughly assess their risk tolerance before considering these intricate products
How The Funds Work
The recently launched ETF invests in Bitcoin futures to deliver two times the daily return of the S&P CME Bitcoin Futures Index. This benchmark tracks the performance of Bitcoin futures listed on the CME exchange. The leverage comes from the fund’s use of debt and derivatives to multiply exposure.
Conclusion
Leveraged Bitcoin futures ETFs allow investors to increase their exposure to Bitcoin price movements. However, the risks are substantial, so investors should carefully assess if these complex products match their goals and risk appetite.
