Quick Breakdown
- Volatility Shares has filed with the SEC to launch 3x and 5x leveraged ETFs tied to cryptocurrencies and top U.S. equities.
- The proposal covers 27 ETFs, including Bitcoin, Ethereum, Solana, Tesla, and Nvidia.
- If approved, the funds could debut in early 2026, marking a milestone for leveraged crypto products in the U.S.
Volatility shares pushes boundaries with 5x crypto ETF proposal
Volatility Shares has taken a significant step toward expanding leveraged crypto investment options with a new regulatory filing that could reshape how traders gain exposure to leading digital assets.
On October 14, the firm submitted documents to the U.S. Securities and Exchange Commission (SEC) proposing a series of 3x and 5x leveraged exchange-traded funds (ETFs) linked to both major cryptocurrencies—including Bitcoin (BTC), Ethereum (ETH), and Solana (SOL)—and prominent U.S. equities such as Tesla (TSLA), Nvidia (NVDA), Coinbase (COIN), and MicroStrategy (MSTR).
The proposal includes 27 ETFs in total, marking what could become the most aggressive crypto fund filing to date.
Building on past experience
This move follows the success of Volatility Shares’ 2x Bitcoin Strategy ETF, launched in 2023, which was the first leveraged Bitcoin futures ETF approved in the U.S. The company now aims to expand its lineup with products catering to high-risk, short-term traders seeking amplified exposure to volatile markets.
According to Bloomberg ETF analyst Eric Balchunas, the SEC has yet to greenlight any 3x crypto ETFs, making this 5x proposal a bold and strategic move. Balchunas suggested the timing could be preemptive, considering potential regulatory slowdowns linked to the U.S. government shutdown.
High risk, high reward
Leveraged ETFs are designed to magnify daily returns—both positive and negative—by using futures, swaps, and options. For instance, a 10% drop in Bitcoin could trigger a 50% loss in a 5x ETF, while sideways markets may erode returns due to volatility decay.
Expense ratios for these funds are expected to exceed those of traditional crypto ETFs, reflecting their complexity and risk. However, with Bitcoin currently trading above $110,000, demand for leveraged exposure is surging as investors seek tools to capitalize on short-term market swings.
If approved, the ETFs are expected to list on exchanges such as CBOE BZX, with a tentative effective date of December 29, 2025, and could launch as early as early 2026.
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