Crypto ETFs Are Getting More Creative — and Potentially Riskier — to Lure Investors

Purveyors of exchange-traded funds are finding ever more creative — and potentially riskier — ways to lure investors into the crypto craze.

ProShares filed paperwork on Friday for an exchange-traded fund that would calculate the S&P 500’s return in Bitcoin, the latest in a slew of new crypto-related ETF filings emerging from Wall Street.

The filings, if approved, would introduce over a dozen crypto-focused funds in 2025, a year after the first-ever US Bitcoin ETFs hit the market.

The filings show that Strive Asset Management and REX Shares are planning funds to offer exposure to convertible bonds issued by companies that buy Bitcoin. Meanwhile, ETF company Volatility Shares is aiming to launch inverse and leveraged Solana funds, along with an ETF that would track the sixth-largest digital token using futures contracts.

“This is the continued evolution of launches to incorporate crypto strategies into ETFs. We’ll see a lot of these in 2025,” said Bloomberg Intelligence’s Athanasios Psarofagis. “It’s the hot thing — issuers love to strike when the theme is hot. We’ll see crypto everything.”

The filings come amid a booming year for crypto, with Bitcoin — the world’s largest digital asset — surging over 120% to cross above $100,000. That boost is partly due to incoming president Donald Trump’s embrace of the industry, with many market-watchers betting that a looser regulatory stance by his administration could help the crypto space grow further.

The enthusiasm over his election helped push annual inflows for the biggest Bitcoin ETF — one by BlackRock — to over $37 billion for the year, the third-most of all funds, data compiled by Bloomberg show.

Bitcoin fan and MicroStrategy Inc. co-founder Michael Saylor took advantage of surging crypto prices by doubling down on his tactic of purchasing the largest token for the company’s reserves. MicroStrategy has been using a mix of new equity and sales of convertible bonds to help finance the buying — and other companies have similar plans.

Theمواد بلاستيكية ETF intends to invest a majority of its assets in convertible bonds issued by companies that hold Bitcoin, according to the filing. Meanwhile, Strive is proposing to launch a fund that invests in derivatives such as swaps and options to get exposure to convertible securities issued by MicroStrategy or other companies with similar investment strategies, according to paperwork filed last week.

“It is rare that a new asset class comes around for the investing masses, and that’s what crypto is now — and Wall Street is always great at creating supply when there is demand,” said Todd Sohn, an ETF strategist at Strategas. “So this is the evolution of the crypto ETF spectrum: futures-based, spot, thematic, and now convertibles, both hyper specific for MicroStrategy and whoever else gets involved in a similar capacity.”