Volatility Shares’ proposal needs a special SEC exemption because Cboe’s generic commodity-trust rules explicitly prohibit benchmark multiples.
Cboe BZX is asking the Securities and Exchange Commission (SEC) for an exception to its own generic listing rules so it can list funds targeting three times the daily performance of Bitcoin and Ethereum futures
The Aug. 10 proposal covers six Volatility Shares funds tied to Bitcoin, Ethereum, gold, silver, crude oil and natural gas. The crypto products would use futures traded primarily on CME rather than hold BTC or ETH directly.
The filing remains pending. An SEC notice dated Aug. 14 said the funds' registration statement was not yet effective and the shares had not been authorized for trading.
The filing remains pending. An SEC notice dated Aug. 14 said the funds' registration statement was not yet effective and the shares had not been authorized for trading.
The proposed funds would reset leverage every trading day, making longer-term returns dependent on the sequence of daily moves, futures performance, costs, and rebalancing rather than simply three times Bitcoin or ETH's return.
The same daily reset that creates that path dependence also determines how much the fund must trade to restore its target exposure after each market move.
In a simplified model, a 3x fund beginning with assets of A starts with exposure of 3A. After a one-day benchmark return of r, restoring exposure to three times the fund's new NAV requires an approximate gross adjustment of 6Ar.
For a hypothetical $100 million fund, a 5% benchmark move implies roughly $30 million of additional buying or selling in the direction of that move.
The calculation does not estimate market impact. The filing provides no launch asset level or flow forecast, and execution would depend on fund size, liquidity, investor creations and redemptions, positioning, and the instruments used.
It does, however, show how moving from 2x to 3x raises both sides of the structure: investors take greater path-dependent exposure, while the fund must make larger daily adjustments to maintain that exposure.