ProShares, a leading provider of exchange-traded funds (ETFs), has launched the world’s first short Ether-linked ETF, giving investors a new way to bet against the second-largest cryptocurrency by market capitalization. The ProShares Short Ether Strategy ETF (SETH) began trading on the New York Stock Exchange Arca on Tuesday, Nov. 2.
The fund seeks inverse exposure to the daily performance of Ether futures contracts traded on the Chicago Mercantile Exchange (CME). According to ProShares, SETH is designed to meet the demand for short exposure to Ether, which can be difficult and costly to obtain in the crypto market.
ProShares New ETF Will Simplify Investments
It aims to offer investors a convenient and cost-effective way to profit from Ether’s price volatility, both on the upside and downside.
“ProShares now offers investors opportunities to profit both on days when Ether increases and when it drops all through the convenience of a traditional brokerage account,” said Michael Sapir, CEO of ProShares.
SETH is the latest addition to ProShares’ suite of crypto-linked ETFs, which also includes the ProShares Ether Strategy ETF (ETHR), the ProShares Bitcoin Strategy ETF (BITO), and the ProShares Short Bitcoin Strategy ETF (SBIT). These funds use Ether and Bitcoin futures contracts as their underlying assets, rather than holding physical cryptocurrencies.
ProShares is one of the first ETF issuers to tap into the growing interest in crypto-related products in the U.S. market. The firm launched BITO, the first Bitcoin futures ETF in the U.S., in October 2021, attracting over $1 billion in assets under management in less than a week. ETHR, the first Ether futures ETF in the U.S., debuted on Oct. 19, 2021.
The launch of SETH comes amid a strong rally for Ether, which has surged over 400% year-to-date and reached a new all-time high of $4,891 on Nov. 16, 2021. The cryptocurrency has benefited from the growth of decentralized applications, non-fungible tokens, and decentralized finance on its network, as well as the ongoing transition to a more scalable and energy-efficient protocol.
However, Ether also faces significant challenges and risks, such as regulatory uncertainty, technical issues, competition from other blockchains, and market fluctuations. SETH offers investors a way to hedge against these risks or speculate on Ether’s downside potential.