Issuers Race To Launch Short Bitcoin Futures ETFs

Direxion and AXS Investments follow suit after ProShares proposes ETF betting against bitcoin

April 8, 2022 04:37 pm

Blockworks exclusive art by axel rangel

Direxion originally filed to launch its Bitcoin Strategy Bear ETF in October but withdrew the application
AXS Investments’ Short Bitcoin Strategy fund would be the firm’s third ETF in the US

After ProShares filed earlier this week to launch an ETF that would allow investors to essentially bet against bitcoin, two other fund issuers followed suit.

AXS Investments revealed its plans to launch a Short Bitcoin Strategy ETF (SBCO) in a Wednesday regulatory disclosure. The product seeks investment results corresponding to the inverse (-1x) of the return of the CME CF Bitcoin Reference Rate for a single day.

The actively-managed fund would invest most of its assets in short positions on cash-settled bitcoin futures contracts traded on exchanges registered with the Commodity Futures Trading Commission (CFTC).

It seeks to remain fully invested in contracts offering inverse exposure to the Bitcoin Reference Rate “without regard to market conditions, trends, direction or the financial condition of a particular issuer,” the filing notes. The fund does not take temporary defensive positions.

Newsletter

Subscribe to The Breakdown

Similarly, Direxion filed to launch a Bitcoin Strategy Bear ETF on Thursday that would offer managed short exposure to CME bitcoin futures contracts.

The fund manager originally filed to launch this ETF in October but withdrew the proposal about a week later upon the request of the Securities and Exchange Commission.

Loading Tweet..

In addition to investing in swaps or futures contracts, the Direxion ETF may also short bitcoin futures ETFs. ProShares, Valkyrie Investments, VanEck and Global X launched such ETFs last year.

“The fund will generally maintain its short exposure to bitcoin futures during periods in which the value of bitcoin is flat or declining as well as during periods in which the value of bitcoin is rising,” the disclosure states.

None of the three funds would invest directly in bitcoin. The filings did not indicate expense ratios for any of the proposed products.

While AXS Investments has just two ETFs trading in the US with about $65 million in assets, according to ETF.com, Direxion has 82 ETFs that manage roughly $27.5 billion.

Spokespeople for Direxion and AXS Investments did not immediately return requests for comment.

Get the news in your inbox. Explore Blockworks newsletters:

The Breakdown: Decoding crypto and the markets. Daily.
0xResearch: Alpha in your inbox. Think like an analyst.

Tags

Newsletter

The Breakdown

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

Upcoming Events

Digital Asset Summit 2026

Javits Center North | 445 11th Ave

Tues - Thurs, March 24 - 26, 2026

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.

buy tickets learn more

recent research

Research

Kinetiq Protocol: From LST Infrastructure to HIP-3 Deployer

Kinetiq has established itself as Hyperliquid's dominant liquid staking protocol, holding 82.5% of LST market share with $610M in TVL. The protocol is now expanding beyond its kHYPE staking core into higher take-rate verticals: iHYPE for institutional custody rails, Launch for HIP-3 capital formation, and Markets for builder-deployed perpetuals. We view Markets, launching Jan. 12, as the highest-potential product line given its mechanically scalable, activity-linked unit economics. Near-term revenue remains anchored by kHYPE's KIP-2 fee schedule (~$1.6M annualized), while Markets provides embedded optionality if HIP-3 economics normalize post-Growth Mode. KNTQ's setup is relatively clean: zero insider unlocks until November 2026, 6.2% buyback yield from staking revenue, and cleared airdrop overhang. Risks center on unproven Markets execution, declining kHYPE TVL despite ongoing incentives, and competition from Hyperliquid's native initiatives.

by Shaunda Devens