Market Analysis Report (27 Jun 2022)

Investors have allocated over $11 million into a recently launched bitcoin exchange-traded fund (ETF) designed to profit when the price of the flagship cryptocurrency declines. The ETF is now the second-largest bitcoin-focused ETF in the U.S.

The ProShares Short Bitcoin Strategy (BITI) ETF has seen inflows of 544.2 BTC since launching, according to Vetle Lunde, an analyst at Arcane Research. The fund is designed to inverse BTC’s performance, meaning investors profit 1% when BTC falls 1%, minus management fees and expenses.

The ETF’s performance was lackluster on its opening day, but inflows soon surged to see its assets under management grow over 900 BTC. The ETF uses BTC derivatives to achieve its performance.

In terms of crypto ETFs trading in the U.S. by assets under management, the short ETF is only behind ProShares’ futures-based bitcoin ETF, BITO, which has the equivalent of 31,000 BTC in assets.