ProShares’ new Short Bitcoin Strategy ETF (NYSE:BITI) issued in New York offers the chance to bet against the crypto.
A new ETF for shorting Bitcoin
After the successful issuance of an ETF on Bitcoin, which set a record for ETF placements, ProShares is at it again.
The US Bitcoin futures ETF was the most successful issuance in ETF history and attracted more than $1 billion in assets in its first two days.
This new ProShares ETF will be the first to allow short exposure to Bitcoin in America, which is already possible in Canada.
On the Wall Street exchange, the financial giant is issuing an ETF that opens short positions on the most capitalized crypto, offering an instrument that gives those who are not confident in BTC the chance to bet against it.
The ETF will essentially replicate the reverse of Bitcoin’s price via Chicago-listed futures. The value of the instrument will appreciate as the value of the digital currency falls.
The instrument fills a gap and allows even those who do not have the ability to use CFDs or do not have access to derivative contracts, to short Bitcoin.
The news was greeted with some concern by those less familiar with the sector, but there is nothing to fear.
The instrument merely offers one more option and complements an already extensive offering from ProShares and in no way portends a bleak future for the currency. On the contrary, the financialization of the asset is one of the causes, albeit a small percentage, of a natural stabilization of prices.
ProShares CEO Michael L. Sapir said:
“As recent times have shown, the value of Bitcoin can decline. BITI offers investors who believe that the price of Bitcoin will drop the opportunity to make a potential profit or hedge their cryptocurrency holdings”.
The range of investment instruments in the crypto market expands
The ETF will replicate the opposite return of the S&P CME Bitcoin Futures index while ProFunds is studying the issuance of a mutual fund (Short Bitcoin Strategy ProFund).
“With the addition of BITI and BITIX, ProShares and ProFunds will be the only fund families in the US to offer funds that will allow investors to express their opinion on Bitcoin’s direction, regardless of whether they believe the price will rise or fall”.
The instrument comes with excellent timing given the debacle of the last week.
Bitcoin hit a new 52-week record low at $17,708.62 (the high was in November 2021 with $69,789.63), while as of today the price stands at $20,504.50 with a +2.67%.