A New York Post article about an exchange-traded fund (ETF) from Direxion that would short cryptocurrencies caused Bitcoin to tumble nearly 5% midday Wednesday. As of 1:50 p.m. EST, Bitcoin was down 5.73% ($3,580.84), from its opening price of $58,999.04.
The Direxion ETF, filed with the U.S. Securities and Exchange Commission (SEC), would allow investors to bet against the future price of cryptos. The filing for the bearish ETF on cryptos comes at a time when there are increasing calls for a regulator, or various regulators, to oversee the exotic currency alternative. To date, cryptos reportedly have attracted roughly $80 billion in assets, from retail and institutional investors alike.
The filing also comes on the heels of ProShares' initial public offering (IPO) of its Bitcoin Strategy ETF on NYSE Arca, last Tuesday, Oct. 19, under the ticker BITO. This crypto futures ETF boosted Bitcoin's price to an all-time high on hopes that it would broaden interest in cryptocurrencies to an even broader base of retail investors.
The Direxion fund would be called the Direxion Bitcoin Strategy Bear ETF. Earlier this year, in the second quarter, brokerage firm Robinhood enjoyed a 25% surge in crypto-related revenue when it gave investors access to Dogecoin.
A call to Direxion for comment on the SEC filing for the Direxion Bitcoin Strategy Bear ETF was unanswered as of 2 p.m. EST.
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