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How this Bitcoin ETF could help you capitalize on a crypto decline
June 3, 2025Every security comes with some volatility, but not many assets experience ups and downs like Bitcoin. Studies show that cryptocurrency is 3.9 times more volatile than gold and 4.6 times more volatile than global equitiesi.
The thought was that Bitcoin would stabilize as it matures, but it seems that growing pains persist, with the cryptocurrency still prone to falling and rising by as much as 12 percentage points in a single dayii.
While some crypto watchers suggest a single Bitcoin could be worth $1 million at some point, predicting where its price might go over the long term is a fool’s errand. Given the extremely limited number of practical applications, at least so far, and the fact that no one is entirely sure how much Bitcoin is left to mine (many have been lost or removed from circulation), there aren’t many fundamentals to base a future price on.
For short-term, daily traders, Bitcoin’s short-term volatility could be an opportunity, particularly if the cryptocurrency falls in value. Global X’s BetaPro Inverse Bitcoin ETFs offer a way to potentially benefit from short-term, daily price movements in Bitcoin, as increased volatility can create new trading opportunities.
| Fund Name | Ticker | Description |
|---|---|---|
| BetaPro Inverse Bitcoin ETF | BITI | BITI is designed to provide daily investment results, before fees, expenses, distributions, brokerage commissions and other transaction costs that endeavour to correspond to up to one-times (100%) the inverse (opposite) of the daily performance of an index that replicates the returns generated over time through long notional investments in Bitcoin Futures. The current Underlying Index of BITI is the BetaPro Bitcoin Front Month Rolling Futures Index (Excess Return). BITI does not seek to achieve its stated investment objective over a period of time greater than one day. |
Here are some of the events that could continue to fuel the volatility in Bitcoin in the months ahead:
Its price moves with markets
Bitcoin often moves in the same direction as equities, not the opposite, as many thinkiii. Between May 2020 and May 2025, the S&P 500 and Bitcoin moved in the same direction – up or down – two-thirds of the time. In 2022, when Nasdaq dropped by 33% and the S&P 500 fell by 19%, Bitcoin’s price declined by 65%. In 2024, Nasdaq climbed about 31%, and the S&P 500 increased by 24%, while Bitcoin’s price jumped by 135%iv. Bitcoin is like a more amped-up version of equity markets. If you think markets will remain choppy, then Bitcoin’s price may continue to fall, too
Investors may be taking profits
It’s in rocky markets when people start selling their winners to lock in gains, in part to move money into underperforming areas of the market, but also to take on less risk. With Bitcoin’s price soaring by more than 1,000% over the last five years, it’s possible investors are deleveraging their exposure to the digital asset. If market volatility continues under U.S. President Donald Trump, crypto holders could decide to realize even more returns, which would affect the coin’s price.
It’s not performing as expected
Market watchers have been touting Bitcoin as the new gold. The U.S. has even mused about starting a cryptocurrency reserve. The thinking is that, like the yellow metal, its price would rise in inflationary periods and tougher economic times. That could be true one day, but that’s not the case today. While the two have tracked each other at times, broadly, Bitcoin has not performed as expected. For starters, the initial U.S. plan to start a crypto reserve underwhelmed the market. The many tariff announcements coming from the U.S. have injected further uncertainty in the market, which has also weighed on Bitcoin. Between January 20, Trump’s inauguration day, and the end of April, Bitcoin has fallen by more than 8.24%. Gold, potentially anticipating the market turmoil that was to come, rose by about 21%v. With that in mind, a recession or other economic turmoil could cause it to remain volatile versus moving higher like we’ve seen with gold.
It’s still driven by sentiment
Cryptocurrencies are still fairly new, so they don’t have a historical track record of performance like other assets do. Because Bitcoin isn’t yet used to buy items in any significant way and because the coin isn’t controlled by any government, its price is far more susceptible to market sentiment. Its value essentially depends on people’s assumptions about future demand, which can shift without any reason when there aren’t any fundamentals to base that future price on.
Take advantage of the turmoil.
If you think Bitcoin’s price could continue fluctuating, an inverse Bitcoin ETF could be a smart way to capitalize on any downturns. These funds are specifically designed for short-term traders, as the price of the ETF resets every day instead of tracking the cumulative return like a long-only Bitcoin ETF would. Because of the price reset, you wouldn’t want to hold these for more than one or two days, or you could lose a lot if your call is wrong.
There are a few reasons why this inverse ETF could help your crypto trading strategy:
- Right now, it’s extremely complicated to take a bearish position on Bitcoin without using margin trading, futures and options. An inverse ETF simplifies the process, removing the need for a margin account, making it easier to bet on a decline.
- An inverse ETF makes it much easier for sophisticated investors to potentially profit from daily market movements.
- During volatile periods, an inverse Bitcoin ETF could help traders and investors who hold Bitcoin manage portfolio risk. If the price falls sharply, gains from holding the ETF could offset losses elsewhere.
- Despite not being a leverage product, because of the way Bitcoin amplifies losses and gains in other markets, such as the S&P 500, the ETF could help investors get leverage-like exposure to a selloff in risky assets.
With the uncertainty in global markets showing no signs of slowing down, Bitcoin’s price could experience plenty more ups and downs ahead. If you are interested in taking advantage of that volatility, now could be the right time to familiarize yourself with inverse Bitcoin ETFs.
DISCLAIMERS
Commissions, management fees, and expenses all may be associated with an investment in products (the “Global X Funds”) managed by Global X Investments Canada Inc. The Global X Funds are not guaranteed, their values change frequently and past performance may not be repeated. Certain Global X Funds may have exposure to leveraged investment techniques that magnify gains and losses which may result in greater volatility in value and could be subject to aggressive investment risk and price volatility risk. Such risks are described in the prospectus. The prospectus contains important detailed information about the Global X Funds. Please read the relevant prospectus before investing.
The Global X Funds include our BetaPro products (the “BetaPro Products”). The BetaPro Products are alternative mutual funds within the meaning of National Instrument 81-102 Investment Funds, and are permitted to use strategies generally prohibited by conventional mutual funds: the ability to invest more than 10% of their net asset value in securities of a single issuer, to employ leverage, and engage in short selling to a greater extent than is permitted in conventional mutual funds. While these strategies will only be used in accordance with the investment objectives and strategies of the BetaPro Products, during certain market conditions they may accelerate the risk that an investment in shares of a BetaPro Product decreases in value. BetaPro Inverse Bitcoin ETF (“BITI”), which is an up to -1X ETF, as described in the prospectus, is a speculative investment tool and is not considered a conventional investment. The Target, an index which replicates exposure to rolling Bitcoin Futures and not the spot price of Bitcoin, is highly volatile. As a result, the BITI is not intended as a stand-alone investment. The returns of BITI over periods longer than one day will, under most market conditions, be in the opposite direction from the performance of its Underlying Index for the same period, and the returns of BITI can, based on historical returns, generally be expected to be substantially similar to the inverse performance of its Underlying Index for the same period, when BITI’s exposure is at -100% of the Underlying Index throughout the period. However, the deviation of returns of BITI from the inverse performance of its Underlying Index can be expected to become more pronounced as the volatility of the Underlying Index, and/or the period of time, increases.
There are inherent risks associated with products linked to crypto-assets, including Bitcoin Futures. While Bitcoin Futures are traded on a regulated exchange and cleared by regulated central counterparties, direct or indirect exposure to the high level of risk of Bitcoin Futures will not be suitable for all types of investors. An investment in BITI or any of the BetaPro Products is not intended as a complete investment program and is appropriate only for investors who have the capacity to absorb a loss of some or all of their investment. Please read the full risk disclosure in the prospectus before investing. Investors should monitor their holdings in BetaPro Products and their performance at least as frequently as daily to ensure such investment(s) remain consistent with their investment strategies.
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Published May 23, 2025
i Bloomberg as of April 29, 2024
ii https://decrypt.co/291289/bitcoin-best-day-ever-gains Bloomberg, as of April 30, 2025
iii Science Direct, May 2023
iv Bloomberg, as at April 30, 2025 v Bloomberg, as at April 30, 2025
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