Two new MicroStrategy ETFs launched on Wednesday. They are roughly 15 times more volatile than the S&P 500. The funds immediately saw higher-than-usual demand from traders.
According to Bloomberg Intelligence ETF analyst Eric Balchunas, there are two new crypto exchange-traded funds in town, and they are the most volatile exchange-traded funds in US history.
“Tuttle just broke the volatility barrier again,” he said, referring to ETF issuers Rex and Tuttle Capital Management, which launched two leveraged microstrategy ETFs on Wednesday.
One of the ETFs is to bet that the stock will go higher and the other to bet that the stock will go lower.
Funds give investors exposure to a microstrategy, such as if a stock goes up or down 5%, ETFs go up or down 10%. It also means about investment instruments 15 times more volatile than the S&P 500According to Bloomberg Intelligence ETF analyst Eric Balchunas.
Although MicroStrategy is a cloud services business, the company's billion-dollar investments in the digital asset have made it a proxy for investing in bitcoin.
While analysts argue that the launch of spot bitcoin ETFs jeopardizes the proxy role, its co-founder and chair, Michael Saylor, says the company still has many advantages. He said that the company will not charge high fees and will develop technology.
The most volatile ETF in the US
The long microstrategy ETF saw $2 million in volume on its opening day and topped $10 million by Thursday afternoon, Balchunas said. has been posted On X.
“Only 1-2% of ETF launches see this kind of volume this early,” Balchunas wrote. “It helps to grow by 17%.”
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The ETF's success is particularly notable given that it is not the first leveraged microstrategy fund to launch.
Another ETF firm, Defiance ETFs, launched the 1.75x MicroStrategy ETF on August 15. The fund crossed the $200 million mark on Wednesday. This puts the fund in the same ballpark as most spot Ethereum ETFs in terms of assets.
“The hot sauce arms race is underway,” Balchunas said. “That little bit of extra leverage moves the needle,” Balchunas said of the T-Rex fund.
MicroStrategy isn't the only crypto firm getting its own ETFs.
ETF issuer YieldMax ETF launched an inverse Coinbase ETF in July, allowing traders to profit from the decline in crypto exchange Coinbase stock while earning yield.
Crypto market movers
Bitcoin is trading at $63,490, up 1.6% in the last 24 hours. Ethereum rose 4.5% to $2,548.
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Tom Carreras is a markets correspondent for News. Got a tip? Email at [email protected].
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