Leverage Shares to Launch Leveraged Bitcoin and Ethereum ETFs in Europe
Despite the recent downturn in the cryptocurrency market, Leverage Shares plans to introduce 3x and -3x leveraged Bitcoin (BTC) and Ethereum (ETH) ETFs for European clients next week. This bold move aims to provide investors with new tools to capitalize on market movements, even amidst volatility.
First-of-its-Kind Offering
Bloomberg ETF analyst Eric Balchunas announced on X that Leverage Shares is set to launch a first-of-its-kind ETF offering 3x leverage on both Bitcoin and Ethereum. The products will include both 3x long and 3x short leverage funds for each asset, with the launch scheduled for next week on the SIX Swiss Exchange.
Expanding Leveraged Product Portfolio
This launch signifies an expansion of Leverage Shares’ existing portfolio of leveraged products. The firm already offers similar products for individual stocks like Apple, Tesla, Facebook, and Amazon. The new ETFs will provide cryptocurrency investors with amplified exposure to Bitcoin and Ethereum.
Not the First Attempt at Leveraged Crypto ETFs
Leverage Shares isn’t the first company to explore leveraged crypto ETFs. Defiance Investments previously proposed a similar suite of leveraged cryptocurrency-related ETFs in a filing with the U.S. Securities and Exchange Commission (SEC) in October. Their application included 49 funds offering 3x leveraged and inverse leveraged exposure to Bitcoin, Ethereum, Solana, crypto-focused stocks, tech stocks, and gold.
Market Context: Crypto Downturn
This launch comes during a sustained downtrend in the cryptocurrency market. Bitcoin and Ethereum have fallen by 21% and 26%, respectively, so far in November. BTC is trading slightly below $84,000, while ETH has dropped to $2,700, facing strong bearish headwinds in recent weeks.
Risks and Concerns
The introduction of leveraged crypto ETPs could be risky, given the inherent volatility of cryptocurrencies. Market participants have voiced concerns about the potential impact on investors, suggesting that high leveraged exposure could lead to rapid liquidations during periods of extreme volatility.
“The timing is either really good or really bad depending on your point of view,” Eric Balchunas stated in his post.
Key Takeaways
- Leverage Shares is launching 3x and -3x leveraged Bitcoin and Ethereum ETFs in Europe.
- The launch is scheduled for the SIX Swiss Exchange next week.
- The move comes despite a recent downturn in the cryptocurrency market.
- Concerns exist about the risks associated with leveraged crypto products.
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