Defiance launches an inverse blockchain ETF
Defiance ETFs, one of the leading providers of thematic exchange-traded funds (ETFs) in the market, has announced the launch of a short blockchain ETF – targeting investors out to benefit from the broader bearish struggle across the crypto industry.
Specifically, the firm has announced The Defiance Daily Short Digitizing the Economy ETF (IBIT), a product that will enter short positions for an actively managed fund dubbed Amplify Transformational Data ETF (BLOK). More details about the ETF are here, including its inception and trading on the NYSE Arca.
Shorting companies such as Coinbase and Robinhood
The BLOK ETF offers an opportunity to benefit from price declines of companies within the blockchain and crypto ecosystem. Also included is an exposure to metaverse companies, Defiance said in a press release on Thursday.
Commenting on the IBIT short blockchain ETF, Defiance CEO Sylvia Jablonski said:
“We remain highly bullish on the growth of crypto and the digital asset ecosystem over the next few years. However, given the recent onset of the crypto winter – the flood of layoffs and revenue losses – we believe shorting positions such as Coinbase, Galaxy and Robinhood, along with those involved in the metaverse, like Meta and Roblox, will provide downside protection in the current environment.”
The news comes as major cryptocurrencies like Bitcoin and Ethereum battle bears following recent dips below crucial price levels at $20k and $1.6 respectively. While an overall bump has been seen over the past 24 hours, and Ethereum news around the merge have helped buoy sentiment, many industry experts believe the fresh downsides are likely in the short term.
Particularly, as Invezz highlighted in this article, tighter central bank monetary policy (today saw the European Central Bank, ECB, raise interest rates by 0.75%) and other macroeconomic and geopolitical factors could see risk-on assets suffer new losses.
In such a scenario, an inverse ETF tracking exposure of blockchain and crypto companies could offer a profitable bet for investors.
In June, ProShares launched a short Bitcoin-linked ETF – the first such product for the US market – with the fund coming as the bear market crash decimated BTC price. Read about that ETF here or go to our page on the latest top ETFs to learn more.