VistaShares has introduced a new exchange-traded fund that offers income-focused investors a hybrid product by combining indirect Bitcoin exposure with US Treasury securities.
Approximately 80% of the assets of the ETF, which is traded on the New York Stock Exchange under the ticker BTYB, are allocated to US Treasurys. Options connected to BlackRock’s iShares Bitcoin Trust are used to relate the remaining exposure to changes in the price of bitcoin.
Rather than holding Bitcoin directly, the fund uses a synthetic covered call strategy. This approach generates weekly income by selling call options, while limiting upside gains if Bitcoin prices surge.
Although distributions may differ depending on market conditions, VistaShares claims that the ETF intends to generate yields that are around twice as high as those of five-year Treasurys. There is no warranty for returns.
The introduction is a reflection of the increasing experimentation in US markets, where asset managers are combining exposure to cryptocurrencies with more conventional assets. These hybrid ETFs are made to appeal to investors who want to participate cautiously in Bitcoin-related opportunities while still looking for income.
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