Leveraged MicroStrategy ETFs surpassed $400 million in net assets, driven by retail investors seeking exposure to Bitcoin’s volatility.
Defiance ETFs launched a leveraged MSTR ETF in August, and rivals REX Shares and Tuttle Capital Management followed suit in September with even more turbo-charged versions. Bloomberg ETF analyst Eric Balchunas termed it the “hot sauce arms race.”
MicroStrategy to Lend Bitcoin for Yield?
MicroStrategy had its genesis as a business intelligence company, but it inverted into a cryptocurrency hedge fund back in 2020, through the founder Michael Saylor, who decided on Leveraged MicroStrategy ETFs in order to leverage the balance sheet to buy Bitcoin.
For the firm, Leveraged MicroStrategy ETFs are shifted to “Bitcoin Yield” as a metric of success now implies its commitment to increasing Bitcoin holdings per share for its shareholders. It did this on August 1, 2023, while continuing to find ways to leverage its balance sheet even more.
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