YieldMax’s New Bitcoin ETF YBIT Seeks SEC Approval In April 2024

Key Points:

• YieldMax plans to launch a Bitcoin options income strategy ETF, YBIT, on the New York Stock Exchange.
• The ETF aims to provide current income and exposure to certain Bitcoin ETFs, enhancing returns during volatility.

YieldMax’s new Bitcoin ETF YBIT is set to launch in 2024, aimed at income generation and performance exposure.

YieldMax has applied to the U.S. SEC to launch a Bitcoin options income strategy exchange-traded fund (ETF), YBIT, to be listed on the New York Stock Exchange. The ETF, expected to be effective from April 10, 2024, is based on the synthetic covered call strategy of spot Bitcoin ETFs.

It aims to provide current income and exposure to the performance of certain spot Bitcoin ETFs, enhancing returns when volatility in the underlying assets increases.

According to sources, YieldMax currently manages 19 vehicles, with $1.32 billion under management, guided by four fund managers with an average of 10 years of industry experience.

Readmore: Bitcoin Hit Lowest Level Amid Surge In ETF Inflows

The Objective of YieldMax’s New Bitcoin ETF YBIT

The primary objective of the YieldMax Bitcoin Option Income Strategy ETF is to seek current income, with a secondary objective of exposure to the share price of one or more Underlying ETPs, with a cap on potential investment gains.

The Fund sells put option contracts on each Underlying ETP to fund the premium of purchased call option contracts, providing exposure to the downside price returns. This structure gives the Fund investment exposure equal to about 100% of the aggregate notional value of an Underlying ETP.

The Fund generates monthly income by selling call option contracts based on the share price of their corresponding Underlying ETP, purchasing U.S. Treasury securities as collateral for the options contracts it sells.