ProShares has submitted a proposal to launch Bitcoin hedge ETFs tied to gold, S&P 500, and Nasdaq 100. According to its filing, the Bitcoin hedge ETFs pair long positions in stocks, with its short position pairing being the United States dollars. It will also be complemented by a long position against Bitcoin through futures contracts.
The ETF will allow ProShares to leverage the leading crypto’s potential as an alternative asset while still providing exposure to the traditional market. This means the fund will not provide direct investment in Bitcoin. Regardless, the move has been regarded by market participants as a move that shows confidence in Bitcoin.
ProShares Bitcoin ETF explained
The filing provides a detailed explanation of what the ProShares Bitcoin hedge ETFs will look like. Bitcoin futures contracts will be used to execute short US dollar/long Bitcoin components. The product ensures a currency hedge against the dollar in addition to exposure to the S&P 500 stock positions. The hedge will provide protection against the dollar’s fluctuations.
Current events have shown that Bitcoin is slowly seeing traditional adoption. This is because the firms in the sector are now looking for ways to provide exposure to Bitcoin and other assets. Vocal experts like Robert Kiyosaki have also made little strides in egging people to purchase the asset, with his latest Bitcoin price prediction putting Bitcoin at $350,000 by 2025.
Bitcoin ETF market inches above $36 billion
The Bitcoin market has enjoyed a stable market that has helped its growth over the last few months. The prospect of the asset has also been boosted by the presence of President-elect Donald Trump and his pro-crypto stance. Trump wants to provide a favorable environment for the asset, pushing for a national Bitcoin reserve.
The idea has been received well, with the news seeing Bitcoin push above $100k. Aside from Trump’s influence, the launch of spot Bitcoin ETFs in the United States on January 11 was also a milestone achievement for the sector. The ETFs provided investors with opportunities to own a portion of Bitcoin without holding the assets. The market has grown steadily, as investors have already pushed $36 billion into the market.
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