Valkyrie signals deeper bitcoin focus with 2x leveraged futures ETF

Valkyrie is launching a 2x leveraged bitcoin futures ETF.

The Valkyrie Bitcoin Futures Leveraged Strategy ETF will trade under the ticker BTFX.

“BTFX operates by investing in Bitcoin futures contracts, with the objective of providing, before fees and expenses, two-times the daily performance of the Index, which is designed to measure the performance of the CME Bitcoin Futures market and is rolled on a scheduled basis,” a press release announcing the fund explained.

Steven McClurg, co-founder of Valkyrie, explained that the ETF is “really designed for institutional investors and hedge funds.”

“The Fund does not invest directly in bitcoin. Rather, the Fund seeks to benefit from increases in the price of Bitcoin Futures Contracts for a single day,” a filing with the Securities and Exchange Commission for the fund clarified.

“We’re seeing pretty strong trading today,” McClurg told Blockworks.

In early January, the SEC gave a slew of spot bitcoin ETF funds the green light to launch. Valkyrie was one of roughly a dozen that proceeded to launch a spot ETF.

McClurg explained that the SEC was “hesitant” about the firm’s BTFX proposal, adding that the spot bitcoin ETF approvals “made it a lot easier to get this over the line.”

“A leveraged Bitcoin ETF is easier for regulators to deal with than even Bitcoin spot because it’s all futures based. So it doesn’t have the same custodial issues that bitcoin spot does,” he continued.

Valkyrie has been working on BTFX for two years following the launch of its bitcoin futures ETF in 2021. The firm initially filed for a leveraged ETF in 2021.

“With Bitcoin so much in the focus right now, traders and investors are looking at how they can use financial instruments to tap into this space, and as a leader in digital-asset-focused ETFs, we wanted to be sure we provide them with a great fund,” CEO Leah Wald said in a statement.

McClurg clarified that even as some issuers — such as BlackRock, Fidelity and Franklin Templeton — turn their attention to spot ether ETFs, Valkyrie remains focused on bitcoin.

“We’re focused on the Bitcoin ecosystem and building out products that make it easy for people to get exposure, whether it’s Bitcoin spot or Bitcoin mining ETF, and this is just yet another way for people to look at the Bitcoin ecosystem,” McClurg said.

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