The announcement of the launch of a short blockchain exchange-traded fund (ETF) was made by Defiance ETFs, which is one of the leading providers of thematic exchange-traded funds (ETFs) in the market. The ETF is aimed at investors who want to profit from the general bearish struggle that is taking place across the cryptocurrency industry.
Specifically, the company has unveiled a new product called The Defiance Daily Short Digitizing the Economy ETF (IBIT), which is a product that will enter short positions for an actively managed fund called Amplify Transformational Data ETF (BLOK). This article provides further information regarding the exchange-traded fund (ETF), including its beginnings as well as its trading on the NYSE Arca.
Speculating against the financial success of businesses like Blockchain and Robinhood
The BLOK ETF provides investors with the potential to profit from a drop in the price of a company that operates in the blockchain and cryptocurrency ecosystem. According to a news statement issued by Defiance on Thursday, this package also includes exposure to companies involved in the metaverse.
Sylvia Jablonski, CEO of Defiance, made the following statement in response to a question about the IBIT short blockchain ETF:
We continue to have a very optimistic outlook on the development of the crypto market and the ecosystem surrounding digital assets over the next few years. We believe that shorting positions, such as Coinbase, Galaxy, and Robinhood, along with those involved in the metaverse, such as Meta and Roblox, will provide downside protection in the current environment. This is especially important in light of the recent onset of the crypto winter, which has been marked by a flood of layoffs and revenue losses.
The revelation comes at a time when major cryptocurrencies like Bitcoin and Ethereum are fighting off bears after recent price drops below critical price levels of $20,000 and $1.6 respectively. Even while there has been a general increase over the course of the past twenty-four hours, and news regarding Ethereum’s integration has helped to boost sentiment, many experts in the industry feel that there will likely be fresh declines in the near future.
In particular, as Invezz underlined in this piece, a tighter monetary policy by central banks (today saw the European Central Bank, ECB, boost interest rates by 0.75 percentage points), along with other macroeconomic and geopolitical concerns, might result in fresh losses for risk-on assets.
An inverse exchange-traded fund (ETF) that tracks the exposure of blockchain and cryptocurrency companies could be a lucrative investment for investors in such a scenario.
The bear market meltdown in June coincided with the debut of a short Bitcoin-linked ETF by ProShares. This was the first product of its kind to be offered on the US market. The fund was introduced as the price of Bitcoin was being devastated. You may learn more about that ETF by reading about it here, or you can browse our pages to learn more about the best ETFs on the market.