The first Bitcoin-linked leveraged exchange-traded fund (ETF) has launched in the United States, marking a significant milestone for institutional crypto adoption. Moreover, the newly launched leveraged MicroStrategy ETF, MSTX, aims to deliver 175% daily exposure to MicroStrategy.
According to Sylvia Jablonski, the ETF could increase leveraged exposure to Bitcoin. She mentioned this in an announcement on Aug. 15:
We’re amplifying the potential for investors seeking long-leveraged exposure to Bitcoin. Given MicroStrategy’s inherent higher beta than Bitcoin, MSTX offers a unique opportunity for investors to maximize their leverage exposure to the Bitcoin market within an ETF wrapper.
ETF inflows can be significant in driving a cryptocurrency’s price higher. Specifically, for Bitcoin, ETFs made up approximately 75% of new investments in the crypto by Feb. 15, pushing it past the $50,000 milestone.
MicroStrategy beat 499 out of 500 in the S&P 500
MicroStrategy is among the foremost publicly traded firms that hold Bitcoin on its balance sheet. According to an post by Michael Saylor, the company has surpassed 99% of firms in the S&P 500 index.
Saylor announced that four years ago, MicroStrategy adopted Bitcoin as its primary treasury reserve asset, and since then, its stock has outpaced 499 out of 500 companies in the S&P 500. The new leveraged ETF may attract considerable investor interest due to MicroStrategy’s strong stock performance, which outpaced Bitcoin’s gains in recent months.
MSTX ETF aims at “sophisticated investors”
Due to the volatile nature of leveraged assets, the fund targets more sophisticated investors rather than retail ones. Consequently, Defiance announced that the fund is specifically suitable for experienced investors, including traders and those using dynamic techniques. The senior analyst at Bloomberg, Eric Balchunas, stated that the ETF could potentially be the most volatile in the US.
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