Exchange-traded fund (ETF) issuer Direxion is showing interest in launching an ETF that shorts Bitcoin (BTC), the world’s top cryptocurrency.
In a filing with the U.S. Securities and Exchange Commission (SEC), the company says that the product, named Direxion Bitcoin Strategy Bear, will provide short exposure to the Chicago Mercantile Exchange’s (CME) Bitcoin futures contracts.
“The Fund seeks to achieve its investment objective through managed short exposure to CME Bitcoin futures contracts. The Fund does not invest directly in Bitcoin.”
According to the SEC filing, the Direxion Bitcoin Strategy Bear ETF will hold short positions in Bitcoin futures contracts irrespective of market direction.
“The Fund will generally maintain its short exposure to Bitcoin Futures during periods in which the value of Bitcoin is flat or declining as well as during periods in which the value of Bitcoin is rising.”
If approved, Direxion Bitcoin Strategy Bear will be listed and traded on the ETF and equities exchange NYSE Arca.
Direxion’s filing coincides with another exchange-traded fund issuer, Valkyrie, applying to launch a leveraged Bitcoin ETF. According to Valkyrie’s SEC filing, the Valkyrie XBTO Levered BTC Futures ETF will apply a 1.25x leverage if approved.
“The Fund seeks daily investment results, before fees and expenses, that correspond to one and a quarter times (1.25x) the daily performance of the Bitcoin Reference Rate. The Fund does not seek to achieve its stated investment objective over a period of time greater than a single day.”
If approved, the Valkyrie XBTO Levered BTC Futures ETF will list and trade on the Nasdaq stock exchange.
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