According to the data, short positions against the $748 million ProShares Bitcoin Strategy ETF have risen to nearly 11%, the highest level since the fund went live in October 2021.

This suggests that crypto bears are flocking to BITO as a way to short Bitcoin while they await the launch of Bitcoin ETFs. Mutual funds like Direxion, ProShares, and AXS have applied for Bitcoin futures contracts over the past few months, but none have yet been approved by the SEC. ProShares also withdrew another Ethereum ETF it applied for last year. Meanwhile, shorting BITO, the first and largest Bitcoin derivatives ETF listed in the US, seems to be working for investors for now.

BITO has dropped nearly 37% so far in 2022, mirroring the drop in Bitcoin exactly. In 2022, the entire cryptocurrency market came under great pressure as a result of rising inflation and the tight monetary policies of the Fed. As a result, BITO is the third-worst performing U.S. ETF among non-leveraged funds this year, according to Bloomberg data.


What is the ProShares Bitcoin Strategy ETF?

The ProShares Bitcoin Strategy ETF (BITO) is the first US-based Bitcoin-linked ETF to offer investors the opportunity to return bitcoin in a convenient, liquid and transparent manner. The fund primarily aims to generate capital gains through Bitcoin futures contracts.

The ProShares Bitcoin Strategy ETF (BITO) is an exchange-traded fund that moves with the Bitcoin price. The expense ratio was initially determined as 0.95%. BITO, the first Bitcoin-linked ETF on the market, began trading on the NYSE ARCA exchange on October 19, 2021. Investors can purchase BITO shares directly through the fund company or a brokerage firm.

Because ETFs are investment securities that can be traded on an exchange, like stocks, they can provide simple and indirect access to cryptocurrencies for individual and institutional investors.