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Stop piling into leveraged Bitcoin ETFs — Consider this instead

Leveraged Bitcoin ETFs are popular, but they often massively underperform the alternatives for crypto futures trading.

Investors are dumping hundreds of millions of dollars into exchange-traded funds (ETFs) that tout 2x leveraged exposure to Bitcoin’s (BTC) price volatility. They are setting themselves up for disappointment. Traders looking for a risk-on BTC bet should stay away from these funds and try out crypto futures exchanges instead.

The past week saw upwards of $100 million flow into leveraged BTC ETFs after a sharp BTC selloff sparked hopes of a similarly dramatic price rebound. Total assets in these funds now exceed $1.4 billion, and more are joining the fray. On July 10, Rex Shares launched two new ETFs designed to deliver 200% exposure to BTC’s price volatility.

Leveraged BTC ETFs appeal to those seeking as much upside from BTC’s volatility as possible with minimal upfront investment. These funds don’t actually hold BTC. Instead, they use derivatives to double down on BTC price exposure. In theory, a 2x leveraged BTC position should return $2 for every $1 gain in BTC’s spot price.

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Bitcoin Primed for a Rebound Based on One Indicator, Says Crypto Analyst – Here’s His Outlook

Bitcoin Primed for a Rebound Based on One Indicator, Says Crypto Analyst – Here’s His Outlook

A closely followed crypto analyst says that Bitcoin (BTC) is gearing up to bounce back based on one key indicator. In a new strategy session, crypto trader Ali Martinez tells his 66,600 on the social media platform X that the Tom DeMark (TD) Sequential indicator is flashing a buy signal on the crypto king’s one-hour […]

The post Bitcoin Primed for a Rebound Based on One Indicator, Says Crypto Analyst – Here’s His Outlook appeared first on The Daily Hodl.

5 times crypto appeared in pop culture in 2024

Retail Trading Giant Robinhood Considering Launching Crypto Futures in US and Europe: Report

Retail Trading Giant Robinhood Considering Launching Crypto Futures in US and Europe: Report

One of the largest retail trading platforms in the world is considering launching crypto futures for customers in the US and Europe. According to a new Bloomberg report, Robinhood is looking at offering crypto futures trading in the US and European markets, but doesn’t have a specific timeline to do so. Said a Robinhood spokesperson, […]

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5 times crypto appeared in pop culture in 2024

Ethereum futures markets suggest rally to $3.7K is highly unlikely

Analysts warn that a spot ETH ETH approval might not produce the bullish price outcome that many traders expect. Do futures markets agree?

Ether (ETH) price might be on the brink of its most significant event in terms of a spot ETH ETF integrating the altcoin with traditional financial markets, yet its price is not responding as expected. In fact, on June 24, Ether reached its lowest level in over a month, falling to the $3,250 level. Although ETH eventually reclaimed the $3,400 support on June 25, both onchain and derivatives metrics suggest limited upside potential.

Some analysts believe that the timing of the Ethereum spot exchange-traded fund (ETF) launch is unlikely to result in substantial net inflows under the current market conditions. Even though the regulator dropped its investigations into Consensys, a prominent Ethereum ecosystem company, and shelved the potential classification of Ethereum staking as a security, the broader economic environment remains challenging.

Bloomberg ETF analysts Eric Balchunas and James Seyffart project that Ethereum ETFs could attract between $1 billion and $2 billion in the initial weeks. Likewise, Stephen Richardson, managing director of financial markets at Fireblocks, told Cointelegraph that he expects significantly lower inflows at the Ethereum ETF launch.

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Coinbase International announces support for pre-launch market

Users will be able to trade futures of soon-to-be-listed tokens and coins on the exchange.

Coinbase International is following in the footsteps of centralized exchanges such as Binance, Bybit, Bitget and OKX in creating a launchpad for up-and-coming crypto projects. 

“Pre-launch markets allow users to trade perpetual futures contracts on tokens that have not launched yet,” Coinbase revealed on June 17, adding: “When the underlying token is launched on applicable spot exchanges, the instrument converts to a standard perpetual contract.”

The feature will be available to institutional investors via Coinbase International and retail traders via Coinbase Advanced. Pre-launch market assets are capped at an initial margin of 50%, or 2x leverage, and a notional position limit of $50,000 per token.

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Luxor and Bitnomial launch Bitcoin mining derivatives product

The new crypto derivatives product allows investors to speculate on future hashrates and hashprices.

Bitcoin (BTC) mining firm Luxor Technology Corporation and Bitnomial Inc. have launched a Bitcoin mining derivative product on Bitnomial’s United States derivatives exchange. 

On May 28, Bitnomial announced the launch of Hashrate Futures, a derivative futures contract for trading the computing power of the Bitcoin blockchain.

Bitnomial claimed the product, trading under the ticker HUP, offers a way for miners to hedge their revenue and for investors to gain exposure to the Bitcoin mining hash rate.

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Hedge Funds Adopt Net Short Positions on BTC and ETH Futures, Kaiko Analysis Reveals

Hedge Funds Adopt Net Short Positions on BTC and ETH Futures, Kaiko Analysis RevealsIn a recent analysis by Kaiko, it has been found that hedge funds are currently holding net short positions on bitcoin (BTC) and ether (ETH) futures. This strategic move reflects a cautious stance amid fluctuating market dynamics and speculative trading activities. Study Shows Hedge Funds’ Net Short Positions in Bitcoin and Ether Futures Amid Market […]

5 times crypto appeared in pop culture in 2024

Bitcoin moves toward range highs but derivatives traders watch from the sidelines

Bitcoin price showed strength near its medium-term range high but multiple factors are preventing derivatives traders from opening new positions.

Bitcoin (BTC) gained 8.4% between May 15 and May 16, peaking at $66,750, which was the highest level in three weeks. Even though Bitcoin stabilized near $65,000, this price change marks a turnaround after BTC retested the $57,000 support on May 1. However, these gains were not enough to instill bullishness according to Bitcoin derivatives metrics.

Part of Bitcoin investors' disappointment can be attributed to the strong performance of traditional assets. The S&P 500 index soared to an all-time high on May 16, with a total gain of 6% over 15 days. Meanwhile, gold gained 4% in the same period and is currently trading at $2,375, less than 1% away from its highest closing price ever.

Bitcoin needs to rally another 12% to reclaim its highest closing price of $73,084. This feat seems unlikely given that the primary driver of price, namely spot Bitcoin exchange-traded funds (ETFs) inflows, has faded. These ETFs captured $12.1 billion in investments since their launch in January but have stagnated for the past two months.

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Bitcoin’s funding rate flattens, but should BTC bulls rejoice and buy the dips?

Bitcoin bulls tend to celebrate when BTC’s funding rate is negative, but is it really a “generational buying opportunity?”

The demand for leveraged buyers using Bitcoin (BTC) perpetual futures has dropped to its lowest levels in over six months, a trend some analysts consider extremely bullish. However, the BTC futures funding rate, which measures the demand between longs (buyers) and shorts (sellers), is greatly influenced by past performance, as historical data indicates.

Let’s dig in to whether or not Bitcoin’s flat funding rate is a sign of a buying opportunity.

Bitcoin’s funding rate fee is implemented by exchanges to manage the use of leverage since every trade involving perpetual contracts requires a buyer and a seller of equal size. When buyers are more aggressive, the funding rate becomes positive, indicating that they are paying for the use of leverage. Essentially, one side compensates the other, ensuring the exchange does not hold exposure risk.

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5 times crypto appeared in pop culture in 2024

Approval of Spot Bitcoin and Ethereum ETFs in Hong Kong Could Happen Early Next Week: Report

Approval of Spot Bitcoin and Ethereum ETFs in Hong Kong Could Happen Early Next Week: Report

The approval of spot market Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds (ETFs) could reportedly happen in Hong Kong as early as next week According to a new report by Bloomberg, anonymous people familiar with the matter say that two companies – Chinese asset manager Harvest Fund Management as well as a partnership between Bosera […]

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5 times crypto appeared in pop culture in 2024