The U.S. Securities and Exchange Commission (SEC) has just approved 3x leveraged long ETPs for Bitcoin, Ethereum, gold, silver, crude oil, and natural gas under the (Securities Act of 1933). Bloomberg ETF analyst Eric Balchunas wrote on the X platform that, according to reports, the SEC has approved a type of exchange-traded product (ETP) that offers approximately 3x leveraged long exposure within the registration framework of the Securities Act of 1933. The underlying assets include Bitcoin, Ethereum, and also gold, silver, crude oil, and natural gas.
In plain terms, this kind of product is designed to allow investors to amplify exposure to the underlying’s upside with less capital: if the underlying rises 1% in a day, the product may theoretically rise about 3%; but if the underlying falls 1% in a day, it may also drop about 3%. Actual performance will still be affected by daily rebalancing, management fees, derivative costs, and market volatility, so it is not necessarily equal to three times the cumulative returns over the long term.
The key point of this news is the progress on the “product registration/approval” front. It does not mean the SEC is endorsing the price movements of Bitcoin or Ethereum, nor does it indicate that these high-leverage products are suitable for all investors. The volatility and loss risk of 3x leveraged ETPs are relatively high, especially if you hold them for longer periods or during periods of sharp market swings.$BTC
$ETH
#SEC
In plain terms, this kind of product is designed to allow investors to amplify exposure to the underlying’s upside with less capital: if the underlying rises 1% in a day, the product may theoretically rise about 3%; but if the underlying falls 1% in a day, it may also drop about 3%. Actual performance will still be affected by daily rebalancing, management fees, derivative costs, and market volatility, so it is not necessarily equal to three times the cumulative returns over the long term.
The key point of this news is the progress on the “product registration/approval” front. It does not mean the SEC is endorsing the price movements of Bitcoin or Ethereum, nor does it indicate that these high-leverage products are suitable for all investors. The volatility and loss risk of 3x leveraged ETPs are relatively high, especially if you hold them for longer periods or during periods of sharp market swings.$BTC
$ETH
#SEC
