The US-based Asset manager Simplify is set to apply for a Bitcoin futures exchange-traded fund (ETF) with the US SEC. The ETF is dubbed as the ‘Simplify Bitcoin Strategy Risk-Managed Income ETF’ and will be listed under the ticker MAXI on Nasdaq.
The ETF will have three strategies for generating income and capital gains.
The first strategy is a bitcoin futures strategy, the second is an income strategy, and the last being an option overlay strategy. The fund’s management fee is charged at 0.85%.
The filing read that the core option overlay is a strategic exposure for partially hedging against bitcoin futures declines. The overlay also expresses convictions about price run-ups or about a specific bitcoin-linked ETF’s price movement.
The filing says that if the price of bitcoin upswings, the fund’s returns may underperform bitcoin because the adviser will certainly buy back the written call options at a likely-higher price.
Alternatively, if the price of bitcoin goes down, the fund’s returns may fall less than bitcoin because the adviser will sell the put options at a likely-higher price or even exercise the put options.
The Securities and Exchanges Commission has received many ETF applications linked to BTC futures In January, too, Simplify had filed to list shares of an investment vehicle monitoring the performance of a few Web3 firms, the Simplify Volt Web3 ETF.
While the US SEC has been sifting through ETF requests very carefully, Australia welcomed its first Bitcoin and Ethereum Spot ETFs with the joint efforts of 21Shares and ETF Securities.
