The US Securities and Exchange Commission approved Cboe BZX’s listing rules for VS Trust’s 3x Bitcoin and Ether products on October 2. The decision clears an exchange-rule hurdle for products sponsored by Volatility Shares that seek amplified daily crypto futures exposure.
The regulatory order covers six funds in total, including products tied to gold, silver, crude oil, and natural gas. Because Cboe’s generic commodity-trust standards exclude products that seek specified multiples of a benchmark, these funds required individual approval.
A preliminary prospectus filed on August 17 lists BITH for the Bitcoin product and ETHK for the Ether product as proposed symbols. However, the October order only approves the exchange’s rule change and does not establish that registration is effective or that trading has begun. As of October 4, registration effectiveness and a first trading date remain unconfirmed, meaning the securities cannot yet be sold.
While commonly referred to with ETF terminology, the order classifies the funds as exchange-traded products structured as Commodity-Based Trust Shares. They lack the investor protections associated with funds registered under the Investment Company Act of 1940.
Each crypto product seeks three times its benchmark’s daily performance before fees and expenses. The benchmarks measure portfolios of first- and second-month futures contracts, with the funds utilizing futures alongside cash collateral to track a futures portfolio's daily return rather than the spot price alone.
Under normal circumstances, the funds intend to rebalance daily. Because each day’s result compounds from a changed asset value, longer-term outcomes can vary. The SEC and the prospectus both warn that daily leveraged products can depart substantially from their stated multiple over weeks or months, amplifying volatility and exposing investors to significant, sudden losses.
