Editor’s note: This story has been updated to correct a reference to the stock ticker of a future 100% downside-protected Bitcoin ETF from Calamos.
The asset management company Reeds was preparing to launch the world’s first 100% downside protected exchange traded fund through the Bitcoin (CRYPTO: BTC), according to a press release issued on Monday.
What happened : The ETF will use a mix of Treasury securities and options on the indice CBOE Bitcoin U.S. ETFan investment avenue that tracks the price returns of U.S.-listed spot Bitcoin ETFs, according to Calamos.
The ETF will reset annually and provide investors with a new upside cap to protect against negative Bitcoin returns for the next 12 months. In practical terms, this means that investors will have to give up some potential gains in exchange for protection in the event of a market decline.
The ETF is expected to be listed on the CBOE on January 22 under the ticker CBOJ. CBOJ shares can be held indefinitely.
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Such ETFs are very successful on the stock side. The CBOJ will be an extension of the ETF series Structured Protection of Calamos, including the Calamos S&P 500 Structured Alt Protection ETF—January (NYSE:CPSY) and the Calamos Russell 2000 Structured Alt Protection ETF—January (NYSE:CPRY), both of which offer 100% downside protection.
Why it matters : The launch of the CBOJ comes at a time when institutional investments in cryptocurrencies are reaching record levels.
Global digital asset investment products saw a record inflow of $44.2 billion in 2024, almost four times higher than the previous record of $10.5 billion set in 2021. The introduction of US cash ETFs have been a key driver of this wave.
Additionally, the success of Bitcoin ETFs is evident in the performance of the iShares Bitcoin Trust ETF IBIT (NASDAQ:IBIT) from BlackRockwhich became the most successful ETF launch in history. The fund accumulated more than $50 billion in assets under management during its launch year.
Price movement : At the time of writing, Bitcoin was trading at $101,696.58, up 2.03% over the past 24 hours, according to data from Benzinga Pro.
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