- The proposed ETF, “ETHL,” seeks leveraged exposure to Ethereum, carrying higher risk due to its leverage mechanism.
- Amid uncertainty, Ethereum’s price increases to $3,700, driven by strong market and social activity and derivatives interest.
Defiance ETFs, a company that sponsors exchange-traded funds (ETFs), has submitted a proposal to the U.S. Securities and Exchange Commission (SEC) for a new ETF that aims to offer double the daily return of the CF Rolling CME Ether Futures Index.
Defiance ETFs just filed for a 2x leveraged #ethereum futures ETF. Will potentially trade under the ticker $ETHL pic.twitter.com/9Z6M6tcQ3V
— James Seyffart (@JSeyff) April 8, 2024
This index tracks the performance of Ethereum futures. The ETF, which has been proposed to trade under the ticker “ETHL,” is designed to give investors leveraged exposure to the fluctuations in Ethereum’s price. However, it also carries a higher risk due to its leverage.
Following this, Defiance also filed for an ETF that seeks to offer double the inverse performance of MicroStrategy’s stock. Both ETFs, if approved, will have Tidal Investments LLC as their investment adviser. Currently, Defiance ETFs manages nine ETFs in the U.S. markets, with a total asset under management of approximately $1.4 billion. These ETFs focus on several sectors including innovative technologies.
The application for the Ethereum-based ETF comes at a time of uncertainty regarding the SEC’s approval of a spot Ethereum ETF, with a decision expected by May.
Ethereum’s price has recently increased by about 8% in the last 24 hours to approximately $3,630, amid signs of heightened market and social activity. Derivative traders have shown interest in Ethereum’s potential for the end of April, with significant open interest in options at higher strike prices.
🌘Ethereum is showing ultra-strong activity today, eclipsing many other assets…
14 hours ago
Average social and market activity gave $ETH a LunarCrush AltRank™ of 64.11 hours ago
Social activity accelerates as price also rises resulting in a much stronger AltRank™ of 10.… pic.twitter.com/9ppFegfuv4— LunarCrush (@LunarCrush) April 8, 2024
Related: Optimistic Outlook: Why Delayed Ethereum ETF Approval Could Benefit Market Dynamics
Despite the positive market activity, some analysts caution that the anticipation of an Ethereum spot ETF approval may lead to temporary market momentum that could reverse if the SEC decides not to approve the ETFs.
