Roundhill Investments has announced that they have launched the first Bitcoin-covered call strategy ETF in the stock markets of America known as YBTC (Roundhill Bitcoin-Covered Call Strategy ETF).
Compared to conventional Bitcoin ETFs, YBTC does not invest directly in it but rather is aimed at following an index based on futures contracts for the same.
The main characteristic of YBTC is its covered call strategy. This includes writing call options on the Bitcoin ETF, and creating a monthly income with limited gain if in case Bitcoin’s price spikes.
For Todd Rosenbluth, Head of Research at VettaFi it is attractive in the volatile Bitcoin market that provides alternative income strategies as well as potential price exposure.
On the other hand, Dave Mazza – Roundhill’s chief strategy officer points out that YBTC offers “high-income potential” and has a feature to invest in Bitcoin as an attraction for investors interested both in investing through dividends and participation with Bitcoin. This fund focuses on monthly distributions, with an expense ratio of 0.95%.
With the recent approval of many spot Bitcoin ETFs in January by the SEC, this is an important step forward for cryptocurrencies.
Unlike traditional spot ETFs, whose performance is directly linked to the price of Bitcoin, YBTC uses a covered call approach that opens up new opportunities for income-seeking investors in this emerging market.
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