European investors will soon gain the ability to take larger, leveraged positions on Bitcoin and Ethereum through new exchange-traded products (ETPs) from Leverage Shares. The offerings, set to launch on the SIX Swiss Exchange, will include both 3x long and 3x short leveraged options for the two major cryptocurrencies.
These products come at a time of heightened market volatility, with Bitcoin and Ethereum experiencing weekly declines of 11.8% and 12.5%, respectively. The new ETFs are designed for investors looking to amplify returns—or risks—amid turbulent market conditions.
Bloomberg ETF analyst Eric Balchunas highlighted the move on X, stating, “Leverage Shares is launching the world’s first ever 3x and -3x Bitcoin and Ethereum ETFs in Europe next week. Timing is either really good or really bad, depending on your point of view.”
Leveraged ETFs: High Reward, High Risk
Unlike traditional ETFs that simply track the price of an underlying asset, leveraged ETFs aim to magnify gains or losses based on daily price movements. This structure makes them suitable for experienced traders seeking amplified exposure but also increases the potential for significant losses.
The new European products follow a growing global trend of leveraged crypto offerings. In the U.S., Volatility Shares recently applied to launch up to 5x leveraged ETFs on Bitcoin, Solana, and XRP, highlighting rising demand for high-risk, high-reward investment tools.
Dogecoin Joins the Leveraged ETF Wave
The leveraged ETF trend isn’t limited to Bitcoin and Ethereum. On Thursday, 21Shares unveiled a 2x leveraged Dogecoin ETF (TXDD), allowing investors to take long positions on the popular meme coin with double the token’s daily performance, minus fees and expenses.
This launch comes in the wake of crypto’s $19 billion liquidation cascade on October 10, which sparked a broad market downturn and highlighted the risks of leverage in the crypto sector.
Are Leveraged Products Creating Systemic Risk?
Industry experts have voiced concerns about the potential long-term impact of leveraged and perpetual trading on market stability. Tom Lee, Fundstrat CIO and BitMine Immersion Technologies Chairman, described the recent market turbulence as part of a broader post-October recalibration. Despite this, Lee remains optimistic, forecasting a potential Ethereum “supercycle” in the months ahead.
Bitcoin recently traded at $84,065, down nearly 13% over the past week, while Ethereum fell 14% to $2,731. On Friday, Bitcoin briefly dipped to $81,000, a seven-month low, triggering over $2.2 billion in crypto liquidations and illustrating the market’s sensitivity to leveraged products.
Conclusion
The introduction of leveraged Bitcoin, Ethereum, and Dogecoin ETFs marks a significant development for European crypto investors. While offering the potential for outsized gains, these instruments carry elevated risk, emphasizing the need for caution and strategic planning in volatile markets.