Cboe seeks SEC approval for first batch of 3x leveraged BTC and ETH ETFs in the US

Odaily News: Cboe BZX Exchange is seeking approval from the U.S. SEC to list a group of leveraged commodity ETFs, including daily leveraged products with 3x exposure to Bitcoin and Ethereum.

According to the proposed rule change filed 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 will primarily hold CME or COMEX futures contracts, backed by cash and cash equivalents, aiming to achieve 3x the daily performance of the corresponding underlying assets.

Since these products do not meet the restrictions on leveraged products under the exchange's general listing standards, Cboe needs to obtain approval through a special rule filing. Such highly leveraged funds are typically geared toward sophisticated investors for short-term tactical trading and are not suitable for long-term holding.

The filing also shows that these funds will operate as "commodity pools" and be subject to CFTC regulation, rather than operating as 1940 Act investment companies under SEC oversight like many traditional ETFs. Commodity pools typically pool capital from multiple investors to trade derivatives or other commodity-related instruments.