SEC approves 3x leveraged Bitcoin and Ethereum ETPs

SEC approves 3x leveraged Bitcoin and Ethereum ETPs
SEC approves 3x leveraged Bitcoin and Ethereum ETPs

​The U.S. Securities and Exchange Commission (SEC) has approved a Cboe BZX rule change allowing the listing of six triple-leveraged exchange-traded products from Volatility Shares. The lineup includes products tied to Bitcoin, Ethereum, gold, silver, oil and natural gas.

The products are designed to deliver three times the daily performance of their underlying assets. For example, a 1% increase in the value of an underlying asset should result in an approximately 3% gain for the corresponding product, while a 1% decline could lead to a roughly 3% loss.

None of the six products will directly hold Bitcoin, Ethereum, precious metals or oil. Instead, they will use regulated futures contracts, with the crypto products tracking futures traded by CME Group.

Volatility Shares to expand leveraged product lineup

The SEC approved the listing on October 2, 2026. The VS Trust lineup includes triple-leveraged products tied to Bitcoin and Ethereum, as well as similar instruments linked to gold, silver, crude oil and natural gas.

Volatility Shares already manages double-leveraged exchange-traded funds tied to the largest cryptocurrencies — the 2x Bitcoin Strategy ETF (BITX) and 2x Ether ETF (ETHU). The regulator's latest decision will allow the company to expand its offering with riskier products providing three times the daily exposure.

Bloomberg Intelligence analyst Eric Balchunas called the SEC's decision a "big win" for Volatility Shares. He also pointed to the shift in the U.S. regulator's approach to crypto exchange-traded products over the past several years.

However, approval of the exchange rule change does not mean trading can begin immediately. A separate Form S-1 registration statement must become effective before the products can launch.

U.S. ETF inflows head for a record

The expansion of exchange-traded products comes amid record investor demand for ETFs in the U.S. By the end of September, inflows into U.S. exchange-traded funds had already exceeded the total for any previous full calendar year.

Equity funds are attracting the largest share of capital, while investors continue to favor ETFs over traditional mutual funds. The current pace of inflows puts the market on track to extend the record further by the end of 2026.

Earlier, we reported that the U.S. Treasury Department and Internal Revenue Service had stepped up scrutiny of an ETF-based tax deferral strategy popular among wealthy investors. Authorities are examining the use of such mechanisms and whether they comply with existing tax rules.

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