2x Bitcoin ETF is removed

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Alex Dovbnya

ProShares, a leading ETF provider in the US, has ended its proposal for a 2x leveraged Bitcoin ETF

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ProShares has announced that it will withdraw its proposal for a 2x leveraged Bitcoin exchange-traded fund (ETF), the ProShares UltraBitcoin Strategy ETF. J

The sudden shift in direction comes less than two months after the asset management firm originally filed with the U.S. Securities and Exchange Commission (SEC) to launch the ETF.

It is important to note that the proposed ETF amendment has not yet been declared effective and no securities have been sold under it.

The decision to withdraw the proposal for this Bitcoin ETF, the first of its kind, intended to provide investors with exposure to Bitcoin prices at twice the daily return, may come as a disappointment to many in the crypto space. ProShares is one of the leading ETF providers in the United States.

The reasons for the abrupt withdrawal are not disclosed in the letter. However, this may be related to ongoing review and hesitation by the SEC.

ProShares’ Bitcoin futures exchange-traded fund (ETF), BITO, underperformed Bitcoin’s price appreciation, largely due to structural costs associated with its futures contracts, according to a report by digital asset research firm K33 Research.

The underperformance illustrates the shortcomings of futures-based ETFs compared to potential spot ETFs

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