đ„CboeSeeks3xBitcoinAndEtherETFs is about:
đ„Cboe has been moving to list leveraged crypto products. Not just 1x spot exposure, but 3x long and -3x short daily performance of BTC and ETH.
đ„Here's the context:
đ„ Cboe Canada already does this: Cboe Canada just listed new BetaPro ETFs offering 3x leveraged and inverse market exposure, trading as SOXL, SOXS, etc. đ„ Europe already has it: LeverageShares debuted the first 3x bitcoin and ether ETFs in Europe â 3x long and -3x short products for both BTC and ETH listing on Switzerland's SIX exchange. A leveraged ETF uses derivatives and debt to amplify daily returns đ„ In the US, Cboe got approval for leveraged crypto derivatives: Cboe Global Markets received regulatory approval to offer leveraged derivatives products on its digital trading platform, including physically and financially settled bitcoin and ether
đ„So why the news now?
đ„On Sept 17, the SEC approved generic listing standards for crypto-related ETPs across Cboe, Nasdaq, and NYSE Arca. The rules were designed to streamline spot crypto listings by removing 19b-4 approvals and shifting the bottleneck to S-1 filings
đ„Right after that, issuers flooded the zone:
đ„REX-Osprey filed 21 crypto funds and Defiance lodged six more products. Defiance's submissions included six leveraged funds â three long Bitcoin, Ethereum, and Solana, while the other three focused on short exposure. All six offer 3x leverage
đ„The catch: Bloomberg's James Seyffart noted that "3x isn't really allowed by the new leveraged ETP rules," and that issuers appear to be "targeting" 3x via options to exceed the standard 2x cap
đ„In other words, Cboe BZX is now the venue where issuers can try to list these, but they have to get creative with options-based structures to hit 3x, since the generic framework was written for 2x max.
đ€What 3x means for you:
đ„3x daily leveraged, not 3x long-term. If BTC goes up 5% today, a 3x long aims for âŒ15% that day. If BTC is flat for a week but volatile, compounding/decay can eat you alive. đ„-3x short is the inverse â it goes up when BTC/ETH goes down 3x that day, but same decay risk. đ„Very high risk, designed for short-term trading / hedging, not buy-and-hold.
đ„SEC review on these new leveraged filings is still pending â after the shutdown period, Balchunas described it as "everything is on ice... it's like a rain delay" until Corp Fin starts declaring S-1s effective again.
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