With the president-elect Donald Trump Set to begin his second term in the White House on January 20, Bloomberg reports that Wall Street is preparing to launch a new wave of financial products that invest in the cryptocurrency market.
The “Wild West” era of cryptocurrency ETFs
In the run-up to Trump’s second term, CEOs and legal experts were in the ETF space a report They develop diverse strategies to attract a wide range of investors.
Emerging cryptocurrency ETFs are expected to take various forms, including those focused on a wide range of cryptocurrencies, often using leverage, options, or quantitative strategies.
Industry insiders expect that New leadership SEC members under Trump will be more receptive to these innovative products than the previous administration.
Aisha Hunt, principal at law firm Kelly Hunt, described the current environment as a “Wild West era” for the ETF industry, where “complex and inverse” cryptocurrency products are likely to proliferate.
Although Trump’s initial presidency saw him brand Bitcoin as a “scam,” his Post Office enthusiasm for the digital asset has changed expectations. Upcoming changes at the SEC are expected to align more closely with industry interests, which could pave the way for a broader range of products, including those related to… Alternative currencies.
Several companies have already submitted proposals to the SEC for ETFs to track digital tokens, including Solana, XRP, Litecoin, and Hedera. The prospects appear promising, especially in light of the expected regulatory position of the new administration.
Mainstream interest in “Bitcoin-Plus” products.
Swee Chung, president of cryptocurrency index provider CF Benchmarks, noted a spike in interest since Trump’s win, particularly in what he calls “Bitcoin-plus” products. Chung suggests that these offerings are designed to provide exposure to Bitcoin while incorporating additional components that can generate premium returns.
This has also been proven by He releases Options on BlackRock’s iShares Bitcoin Trust (IBIT), which reached nearly $2 billion in notional volume across 354,000 contracts on its first day of trading.
Cboe, is a derivatives exchange for trading digital assets and securities as well Announce Launch of the first cash settlement index options linked to Bitcoin price movements, scheduled to debut on December 2nd.
John Duffy, chief investment officer at Astoria Portfolio Advisors, has also expressed interest in incorporating Bitcoin into his ETF model portfolios, especially if the cryptocurrency experiences a price correction.
Duffy envisions potential products that could expose a range of cryptocurrencies using “rules-based investment methods” similar to those used in traditional currencies. Stock screening.
Ultimately, Xiliang Tang, President of Arbelos Markets, expects “innovative strategies” to continue to be incorporated into crypto ETFs, leading to products such as leveraged ETFs, altcoin-focused funds, and diversified baskets of digital assets.
At the time of writing, the market-leading cryptocurrency is trading at $95,500, down 1.2% on the 24-hour time frame.
Featured image of DALL-E, chart from TradingView.com