Bitcoin ETF Listing Approved, Targets 3x Daily Futures Moves
SEC Approves Listing of Bitcoin ETF Targeting 3x Daily Futures Moves
The U.S. Securities and Exchange Commission has approved the listing of a bitcoin-linked exchange-traded fund designed to target three times the daily performance of a bitcoin futures benchmark, according to a regulatory order covering a broader set of commodity-based products.
The approval comes amid a major shift in the U.S. market for bitcoin exchange-traded products. On Jan. 10, the SEC voted to allow the listing and trading of multiple spot bitcoin exchange-traded product (ETP) shares, opening the door for mainstream investors to access bitcoin exposure through traditional brokerage accounts.
These spot approvals followed years of rejections, during which the SEC argued that the underlying bitcoin markets were insufficiently regulated and vulnerable to manipulation, making it difficult to meet requirements under the Securities Exchange Act of 1934 that exchange rules be designed to prevent fraudulent and manipulative acts.
Regulatory momentum shifted after Grayscale Investments’ August 2023 court victory in the D.C. Circuit. The court ruled the SEC acted “arbitrary and capricious” when it rejected Grayscale’s application to convert the Grayscale Bitcoin Trust into an ETF listed on NYSE Arca, particularly given the agency had already approved ETFs based on bitcoin futures contracts.
In its order approving spot bitcoin ETP listings and trading, the SEC cleared a group of products including:
- Grayscale Bitcoin Trust
- Bitwise Bitcoin ETF
- Hashdex Bitcoin ETF
- iShares Bitcoin Trust
- Valkyrie Bitcoin Fund
- ARK 21Shares Bitcoin ETF
- Invesco Galaxy Bitcoin ETF
- VanEck Bitcoin Trust
- WisdomTree Bitcoin Fund
- Fidelity Wise Origin Bitcoin product
SEC Chair Gary Gensler emphasized that the decision was narrowly limited. “Today’s Commission action is cabined to ETPs holding one non-security commodity: bitcoin,” he said, adding that the approval should not be read as signaling a willingness to approve listing standards for crypto asset securities or as a change in the agency’s broader approach to crypto compliance.
Gensler also cautioned that while the SEC approved the listing and trading of certain spot bitcoin ETP shares, the agency did not approve or endorse bitcoin itself, and said investors should remain cautious about the risks tied to bitcoin and related products.
The approvals arrived one day after an unauthorized post briefly appeared on the SEC’s X account claiming the products had been approved. The SEC said it quickly disavowed the post and is coordinating with law enforcement and its internal watchdog to investigate the incident.
Industry and policy reactions remain divided. Dennis Kelleher, CEO of investor advocacy group Better Markets, called the approvals a “historic mistake,” arguing that bitcoin remains exposed to fraud risks.
The move also sits alongside the existing U.S. market for bitcoin-futures ETFs, which provide exposure via futures contracts rather than holding bitcoin directly and have been criticized for sometimes diverging from bitcoin’s price. The newly approved spot products, along with newly approved leveraged futures-based offerings such as the 3x daily-target fund, broaden the menu of exchange-traded ways investors can access bitcoin-linked returns within traditional market infrastructure.
Following the SEC’s spot ETF decision, expectations around regulatory approval helped lift bitcoin to its highest level in about two years, with the cryptocurrency trading just below $46,000 late Wednesday, up from $17,000 in January 2023.
