**MicroStrategy ETFs Surge Past $400M in Assets**
Retail investors are flocking to leveraged MicroStrategy (MSTR) ETFs, pushing net assets over $400 million, Bloomberg Intelligence reports.
- **Launches and Competition:** Defiance ETFs kicked off the trend in August with the first leveraged MSTR ETF. By September, REX Shares and Tuttle Capital Management joined the fray, intensifying competition.
- **MicroStrategy's Shift:** Originally a business intelligence firm, MicroStrategy pivoted to a cryptocurrency hedge fund in 2020, using its balance sheet to buy Bitcoin.
- **New Metrics:** On Aug. 1, MicroStrategy introduced "Bitcoin Yield" to measure BTC-per-share, aiming to finance more Bitcoin buys.
- **Debt Issuance:** In September, MicroStrategy announced plans to issue $700 million in debt to purchase more Bitcoin and potentially lend out holdings for yield.
- **ETF Details:** Defiance's MSTX seeks 175% long daily exposure to MSTR, while REX and Tuttle's MSTU and MSTZ offer two-times leveraged long and short exposure, respectively.
- **Market Reaction:** The ETFs saw over $70 million in inflows during their first week, highlighting strong investor interest despite the risks associated with leveraged ETFs.
Bloomberg's Eric Balchunas noted the rapid adoption, reflecting a high demand for leveraged crypto plays.