ChainCatcher report: Cboe BZX Exchange is seeking SEC approval to list a suite of leveraged commodity ETFs, including daily 3x long Bitcoin and Ethereum products. According to the proposed rule change filing submitted on Friday, Cboe plans to launch 3x Gold ETF, 3x Silver ETF, 3x Bitcoin ETF, 3x Ether ETF, 3x Crude Oil ETF, and 3x Natural Gas ETF. These funds aim to achieve three times the daily performance of their underlying assets primarily by holding futures contracts on CME or COMEX, backed by cash and cash equivalents. Since these products do not meet the exchange’s general listing standards regarding leveraged instruments, Cboe must seek approval through a special rule filing. Such highly leveraged funds are typically designed for sophisticated investors for short-term tactical trading and are not suitable for long-term holding. The filing also indicates that these funds will operate as “commodity pools” subject to CFTC regulation, rather than as investment companies under the SEC’s 1940 Act, as many traditional ETFs do. Commodity pools typically pool funds from multiple investors to trade derivatives or other commodities-related instruments.
Cboe Seeks SEC Approval for the First 3x Leveraged BTC and ETH ETFs in the U.S.
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Summary
Cboe BZX Exchange filed with the SEC seeking approval for 3x leveraged BTC and ETH ETFs, marking a key SEC update. The proposed products include daily leveraged funds for Bitcoin, Ethereum, Gold, Silver, Crude Oil, and Natural Gas. These funds will use futures contracts and cash collateral to track three times the daily performance of their underlying assets. Cboe must obtain special approval due to current listing rules. The ETFs will operate as CFTC-regulated commodity pools, not under the Investment Company Act of 1940. This BTC update signals a potential expansion of leveraged crypto products in the U.S. market.
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