The underperformance stems from the costs associated with the fund’s structure. BITO does not purchase tokens, instead it holds BTC futures contracts on the Chicago Mercantile Exchange (CME). The fund must roll over the contracts every month as they expire, making it vulnerable to the price difference between terms. If next month’s contract trades at a premium to the nearest expiry – a phenomenon called contango and typical during a bull market – over a sustainable period, the fund will compound losses due to the “contango bleed.”
Arbitrum Attracts Over 48% Of Assets From Ethereum: Why Is ARB Down 68% In 7 Months?
ARB, the native token of Arbitrum, the Ethereum layer-2 solution, is down 68% from January 2024 highs. However, there is...