Calamos Investments Introduces Bitcoin Exchange-Traded Fund With 100% Downside Protection

Set to debut on the Chicago Board Options Exchange on Jan. 22, the ETF, called CBOJ, aims to address Bitcoin's volatility while offering growth potential.

Calamos Investments is launching a Bitcoin exchange-traded fund with a unique feature: 100% downside protection.

Set to begin trading on the Chicago Board Options Exchange on Jan. 22, the ETF, dubbed CBOJ, aims to address Bitcoin’s volatility while offering growth potential, a company statement reads.

Due to its drastic price swings, Bitcoin (BTC) has often deterred risk-averse investors. However, the CBOJ ETF aims to change this by ensuring that investors cannot lose money, even if Bitcoin's value decreases.

The fund achieves this protection by combining U.S. Treasury bonds with options linked to the CBOE Bitcoin US ETF Index. This structure provides a regulated and transparent way to gain Bitcoin exposure while minimizing risk.

The CBOJ ETF builds on Calamos' Structured Protection ETF series, which was launched in 2024 and offered similar protection for stock indices such as the S&P 500 and Nasdaq-100.

Annual protection reset

In contrast to traditional ETFs, CBOJ resets its downside protection annually. Each year, investors will receive a new cap on potential gains while maintaining complete protection against losses for the following 12 months.

"Many investors have hesitated to invest in bitcoin due to its epic volatility,” said Matt Kaufman, Head of ETFs at Calamos. “Calamos seeks to meet advisor, institutional and investor demands for solutions that capture Bitcoin's growth potential while mitigating the historically high volatility and drawdowns of [the asset].”

A report from December 2024 suggested that several major exchanges, including Calamos, will pivot to new derivatives-based Bitcoin ETFs to aid cautious investors in navigating the crypto's drastic price movements.

ETFs are investment funds that trade like stocks on exchanges, allowing investors to pool their money into a fund that holds various assets.

In essence, CBOJ provides a way for investors to gain exposure to Bitcoin without directly owning it, thanks to its protective structure that aims to minimize losses.