SEC Approves Rule Change for Proposed 3x Leveraged Bitcoin Futures ETF

Key Facts

The US Securities and Exchange Commission approved a Cboe rule change to allow the listing of the BITH ETF, which targets three times the daily return of a Bitcoin futures benchmark. TokenPost reported that the approval moves the proposed leveraged fund closer to reality, although the product had not commenced operations as of the latest issuer filing.

The fund intends to use short-term Bitcoin futures to pursue its daily target without holding Bitcoin directly, carrying an annual management fee of 1.85%. Issuers warned that daily compounding and futures-roll costs mean the fund is not designed to deliver triple the benchmark's cumulative return over long periods, noting that a significant Bitcoin decline could result in a total loss of value in a single day.