Bitcoin ETF with downside protection set to debut

The Calamos Bitcoin Structured Alt Protection ETF — January is set to offer “systematic risk management” across its roughly one-year outcome period

article-image

Alexey Oleynik/Shutterstock modified by Blockworks

share


This is a segment from the Forward Guidance newsletter. To read full editions, subscribe.


A new type of bitcoin ETF is set to go live this week. It’s one that aims to bring a particular kind of investor off the sidelines.

The Calamos Bitcoin Structured Alt Protection ETF — January (CBOJ) is set to offer “systematic risk management” across its roughly one-year outcome period. In other words, investors who buy on the first day of trading will essentially be protected against BTC price drops if they hold shares throughout that span, Calamos Investments ETF head Matt Kaufman noted.

Read the fine print, of course.

While investors could gain BTC exposure with 100% downside protection, there’s a slight catch: The upside potential is capped (at an amount to be determined on the expected Jan. 22 launch date).

CBOJ seeks to achieve this strategy by investing in what are known as FLEX options, as well as other securities like US Treasurys. 

The demand for US spot bitcoin ETFs has so far surpassed the expectations of many; the funds notched net inflows north of $35 billion in their first year. 

A number of wealth managers — and even pension funds — have bought into them. Still, we know from 13F filings (and more anecdotally too) that many of these buyers are retail investors. 

Enter this new product, which could be a game-changer for some. Financial advisers and institutions are generally willing to give up some gains for a known protection against loss and reduction of risk, Calamos’s Kaufman argued.

“Such a capital-protected bitcoin strategy should exhibit relatively low volatility, though likely higher than a capital-protected strategy tied to the equity market,” he told me.

A Bitwise/VettaFi report published earlier this month found advisers are indeed curious about more sophisticated crypto investment strategies. Roughly a quarter of those surveyed expressed interest in buffered strategies — aka “defined outcome” funds — that seek to mitigate crypto’s volatility. 

The Bitwise/VettaFi interpretation? These pros allocating for clients “want access to strategies that can provide a differentiated set of returns beyond buy-and-hold exposure.”

Kaufman noted some might choose to pair CBOJ (or other risk-managed bitcoin ETFs) with a spot product like BlackRock’s IBIT “to reduce the risk of loss and shape their experience.”

It’s of course easy for an executive whose firm is selling such an ETF to say this. Flow data over time will give us a better sense of the demand for such tools.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template (11).png

Research

Union’s technical design brings measured improvements to crosschain interoperability. By combining a consensus-verified hub with novel constructs like state lenses and ZK proofs for client updates, Union achieves an interoperability protocol that is highly performant, trust-minimized, and scalable.

article-image

Fundstrat’s chief investment officer may be the apex bull

article-image

MetaMask now lets users create and restore wallets via social accounts

article-image

Filing seeks to expand regulated crypto exposure, with Coinbase Custody as fund custodian

article-image

Hyperliquid’s fundamentals continue to improve, yet its valuation remains discounted compared to other L1s

by Carlos /
article-image

A strategic VC move positions Polymarket for US return amid evolving regulatory clarity, according to Axios

article-image

Deal links Trump Media platforms with Crypto.com wallet and token rewards