ProShares is set to list the US's first exchange-traded fund (ETF), which will allow investors to invest in the fall of the Bitcoin (BTC) price.
ProShares announced on Monday that its ProShares Short Bitcoin Strategy (BITI), designed to represent the reverse of Bitcoin's performance, will begin trading on the New York Stock Exchange (NYSE) on Tuesday. The ETF will allow investors to hedge their Bitcoin exposure, which could be particularly important given the recent sharp decline in the crypto markets.
ProShares was the first company to list a BTC futures ETF in October, which allowed the world's largest cryptocurrency to hit an all-time high of $68,900 in the weeks that followed. Bitcoin investors will hope that the listing of the short BTC futures ETF does not have a similar adverse effect on the world's largest crypto. Because in the bull of 2017, CME futures were launched and the way for institutional investors to open a short position on BTC, that is, to take a bearish position, was paved. After that, serious declines were seen in BTC.
On June 18, the BTC price dropped below $20,000 for the first time since December 20, 2020, and fell to $17,800 the next day. ProShares filed to list BITI in early April, around the same time leveraged ETF provider Direxion submitted an application to list a similar product. There is no update yet on the status of Direxion's application. Similarly, a short BTC ETF is currently listed by Horizon on the Toronto Stock Exchange, Canada.
Grayscale's Bitcoin Trust (GBTC) product trades at a discount of 34%
The investment product Grayscale Bitcoin Trust (GBTC), which is tied to the Bitcoin price, is performing worse as it diverges from the underlying asset. While Bitcoin has dropped about 55% so far this year, GBTC has lost 63% this year.
GBTC is also currently trading at a record 34% discount to Bitcoin price. The investment product, which has a lower price than the current Bitcoin price, is seen as an opportunity by some investors. On the other hand, price deviation also reflects the uncertainty and turmoil in the market. GBTC currently has a share price of $12.47, a 19-month low, showing that it is trading 34% lower than the value of Bitcoin held by Grayscale, according to Konglas data.