- SEC approves a listing rule for six 3x futures ETPs, including Bitcoin and Ether.
- Trading awaits an effective Form S-1 registration, with no launch date disclosed.
- Daily leverage resets can erode returns even when underlying prices end flat.
The U.S. Securities and Exchange Commission approved a Cboe BZX rule change, clearing the way for listing of the first U.S. exchange-traded products targeting three times the daily performance of Bitcoin and Ether.
The decision covers six futures-based products from Volatility Shares, pairing the two cryptocurrency funds with products tracking gold, silver, crude oil, and natural gas. Each seeks a daily return equal to three times its underlying asset’s performance.
Registration Requirement Keeps Launch Pending
The SEC issued its approval under Release No. 34-106577 after Cboe BZX submitted the proposed rule change on August 10. The commission published notice of the proposal on August 14 before approving it on October 2.
That decision addresses restrictions on leveraged commodity-based trust shares and the regulatory category that covers these products. All six operate as series of the Volatility Shares Trust, with Volatility Shares LLC serving as sponsor.
Before trading can begin, a separate Form S-1 registration statement must become effective under the Securities Act of 1933. The approval provided no timeline for that step, leaving the launch date unresolved.
Futures Provide Exposure Without Direct Holdings
The crypto products are named 3x Bitcoin ETF and 3x Ether ETF. Despite those names, neither directly holds the digital asset it tracks. Instead, the funds use futures contracts to establish exposure.
These agreements set a price for buying or selling an asset at a later date. The same structure applies across the commodity products, which avoid direct ownership of their underlying assets. The approval covers leveraged futures exposure across six markets, with a shared daily performance objective.
Daily Resets Shape Returns Over Time
For investors holding these products beyond a single session, the daily reset affects how returns accumulate. The threefold target applies to each trading day, rather than an entire holding period.
Consequently, weekly or monthly performance depends on the sequence of market moves. Alternating gains and declines can erode a fund’s value through compounding, even when the underlying asset ends the period close to its starting price.
The decision follows the SEC’s court fight over spot Bitcoin ETFs three years earlier. For these six products, however, the current registration requirement remains the next condition before trading can start.
Related: NYSE Removes Bitcoin, Ether ETF Options Limits After SEC Approval
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