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Bitcoin

First Short Bitcoin ETF To List On NYSE (coindesk.com) 44

Posted by BeauHD from the betting-against-Bitcoin dept.
An anonymous reader quotes a report from CoinDesk: Investment product provider ProShares is set to list the U.S.'s first exchange-traded fund (ETF) allowing investors to bet against the price of bitcoin (BTC). The ProShares Short Bitcoin Strategy (BITI), which is designed to deliver the inverse of bitcoin's performance, will start trading on the New York Stock Exchange (NYSE) Tuesday, ProShares announced Monday. The ETF will allow investors to hedge their bitcoin exposure, which may prove particularly pertinent given the sharp downturn in crypto markets of late.

ProShares was the first firm to list a bitcoin futures ETF in October, a factor which saw the world's largest crypto hit an all-time high of around $68,900 in the subsequent weeks. Bitcoin investors will be hoping the listing of a short bitcoin futures ETF does not have a similar effect on the world's largest crypto in reverse. Bitcoin's price dropped below $20,000 for the first time since Dec. 20 on June 18, falling as low as $17,800 the following day.
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First Short Bitcoin ETF To List On NYSE More

First Short Bitcoin ETF To List On NYSE

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  • Too bad... (Score:3)

    by jddj ( 1085169 ) on Monday June 20, 2022 @06:05PM (#62637538) Journal

    Just a few days too late.

    • Just a few days too late.

      Until Tether collapses, you have not even seen the bulk of BTC unwinding.

      I would say $6k is a realistic target, but honestly it's probably lower than that.

      Don't take this as advice when to buy though as crypto is just too random for me to be able to offer any kind of solid advice as to a real low. I personally will probably stay out of crypto altogether no matter how temping the gyrations may be, until I see at least six months of predictable and reasonable price behavior, along wi

  • Where is the triple-short ETF? (Score:3)

    by aaarrrgggh ( 9205 ) on Monday June 20, 2022 @06:10PM (#62637570)

    It would be interesting to see what would happen with a highly leveraged short ETF.

  • Much as I hate Bitcoin (Score:5, Insightful)

    by rsilvergun ( 571051 ) on Monday June 20, 2022 @06:21PM (#62637614)
    shorting should be illegal. It creates perverse incentives that wealthy investors can exploit. Rich folk have been caught multiple times undermining a business they hold a short position on. Essentially corporate sabotage.

    We don't have to allow anti-social behavior in our economy out of some strange obligation to the free market.

    • Re: (Score:2)

      by Ecuador ( 740021 )

      They could start by having some stricter rules on shorting. You should only be able to short using shares you can actually borrow, not imaginary ones. I am talking about naked short selling which is supposed to be illegal, but there are still loopholes.
      But, yeah, despite the fact that I understand the arguments that it can provide liquidity, or like here for hedging other positions, I don't like shorts. Not as much as I don't like high frequency trading of course.

      • Loopholes. Lots and lots of loopholes. Generally speaking if something like this exists because of how business men have so much pull in our political system if you give an inch they take a mile. That's why the only solution is a total ban. While we're at it ban leveraged buyouts. You shouldn't be able to buy something using the thing itself is collateral and then effectively load that thing down with the debt and pocket the money yourself.

    • shorting should be illegal. It creates perverse incentives that wealthy investors can exploit. Rich folk have been caught multiple times undermining a business they hold a short position on. Essentially corporate sabotage.

      Short selling, including short option trading, is a conventional, regulated securities market technique. It "thickens" markets by restraining sharp upward price movements and, by creating "short interest" or bulk amounts of borrowed shares that at some point have to be repurchased to be given back to lenders, also damps down sharp down moves.

      But a short ETF in a pure speculative fake asset with no value behind it? Things are about to get...interesting.

      • You just described a perfect world that doesn't exist. Meanwhile extremely wealthy people used all the money and influence they have to make sure that they're short positions succeed even if that means destroying the company in the process.

        • Re: (Score:2)

          by tlhIngan ( 30335 )

          Meanwhile extremely wealthy people used all the money and influence they have to make sure that they're short positions succeed even if that means destroying the company in the process.

          So you're saying Bitcoin is going to die soon because of this?

          Seems like a fine result to me.

    • No, shorting outs fraud and does the SEC's job for (Score:5, Informative)

      by waspleg ( 316038 ) on Monday June 20, 2022 @07:36PM (#62637812) Journal

      profit. I recommend you watch The China Hustle [wikipedia.org] which does a great job showing how this works in an 80 minute documentary format.

      There are absolutely exceptional short sellers who publicly post their research. Hidenburg Research [hindenburgresearch.com] is one of the best and has a free email list. I'm pretty sure the documentary mentions Muddy Waters, and there are others like the Bear Cave [substack.com] which I also subscribe to. These people are top tier journalists who put their money where their mouth is. It's a fucking public service and they get almost nothing but hate for it.

      But, as I said, they wouldn't exist at all and there would be no need if the SEC did their job (this is mostly due to being criminally underfunded, as if that's not by design), but congress has exemptions for their own insider trades. As St. Carlin said, It's a big club and you ain't in it. [youtube.com]

    • Re: (Score:2)

      by DRJlaw ( 946416 )

      shorting should be illegal. It creates perverse incentives that wealthy investors can exploit. Rich folk have been caught multiple times undermining a business they hold a short position on. Essentially corporate sabotage.

      But rick folk boosting a business that they hold a long position on is a-ok, why exactly?

    • Short ETFs for "commodities" can be a healthy tool and manage risk-- it is a lot like a put option which can have purposes beyond thinking a stock will go down (or trying to force it down).

    • shorting should be illegal. It creates perverse incentives that wealthy investors can exploit. Rich folk have been caught multiple times undermining a business they hold a short position on.

      Driving should be illegal. It creates an incentive to escape from a robbery quickly. Criminals have been caught multiple times using cars to get away from bank robberies.

      Here's the thing: undermining a business due to a trading position (any trading position be it short or otherwise) is already illegal. Holding a short position on one company is no more or less an incentive to undermine said company than holding an investment position in a competitor.

      So no, shorts should not be illegal. We shouldn't be some

    • Which companies that didn't deserve that were actually damaged in any way by short sellers?

      • I was going to ask a similar question. Short selling ends terribly for the short seller if the company runs their business well and makes a profit. There are many companies out there that have benefited from successful inertia but are no longer well run and will quickly become irrelevant. Holding a short position makes sense. In some (perhaps rare) cases it even benefits the long investors. In theory, when shares are borrowed to short, the lending owner gets a fee which either juices their profits or r

  • Question (Score:5, Funny)

    by buss_error ( 142273 ) on Monday June 20, 2022 @06:27PM (#62637626) Homepage Journal

    Is there a block chain to short block chains?

  • If this does not prove that the stock markets are just a casino, then what does.
    • Life is a casino.

    • Re: (Score:3)

      by splutty ( 43475 )

      Shorting != "The Stock Market"

      And as others have said, the advantages of being able to maintain short positions are not worth the amount of outright fraud that happens with them, in my opinion.

    • If you're going to accept BTC as payment there has to be a market in which you can take a hedging position. Now I wouldn't ever take BTC as payment for anything which is a much easier solution. But the ability to be long or short assets that you need to run your business is an essential function. Being able to be short BTC means that if you take BTC as payment and it plummets before you can convert to cash your business doesn't go bankrupt.

  • If you want to short bitcoin or ether, open a futures trading account on Ameritrade. Use the paper trading to get a feel for how it works. Once it makes sense, it is so much simpler and price efficient and no management fees.

    The structuring of futures as contracts is weird at first (to me it was), but then it clicks and is easy to track and follow costs, gains and losses. There's no "shorting" per se, you simply have a net holding of contracts +2, +1, 0, -1, -2. When you're at 0, you've settled. And tax tr

  • Not necessarily the ultimate bottom, but Bitcoin might rally to 40K from here, destroying all the people who will be suckered into buying this short ETF thinking that Bitcoin is worthless. They might ultimately be right, but remember, the market can stay irrational longer than you can remain solvent.
  • It seems every time opportunism rears it's head it's about to have it bit off

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