ProShares's Bitcoin Short Fund Soars as Bitcoin Prices Fall

ProShares's product (purpose) allowing bets against the growth of bitcoin prices registered millions of USD in the past week.

Despite the persistent fears of recession among investors and the rising bets on short positions through a new institutional product, Bitcoin surpassed $20,000 on Wednesday morning.

This article was written in English.

Bitcoin increased by 2% in the last 24 hours, continuing with a gradual recovery after the sudden fall last month, to $17.700. The cryptocurrency faces resistance at $21.500 level as shown by price charts, while there is a support at $18.800

Bitcoin se encuentra en un rango actual entre $21K y $18K. (TradingView)
Bitcoin's price is between $21K and $18K at the moment. (TradingView)

The recovery came after institutional traders rushed in on the recent ProShares strategy for short positions of bitcoin in a tradable investment fund (EFTs, for its English acronym) called BITI, where bets are placed against the prices of cryptocurrency.

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El fondo cripto CoinShares informó que los ingresos de esa estrategia alcanzaron un valor de $51 millones la semana pasada, lo que constituye un nuevo récord histórico desde el lanzamiento del EFT inverso a fines de junio.

"CoinShares analysts said that investment products brought in a total of $64 million," reported the analysts. "Even so, these figures obscure the fact that a large majority bet on short positions in bitcoin investment products."

CoinShares stated that inflows of BITI probably indicate that it is one of the products that allows exposure to short positions through futures contracts for investors, as opposed to being a signal of change in sentiment.

"CoinShares said that the short positions on bitcoin are probably due to its accessibility in the U.S. for the first time, instead of renewed negative sentiment," as it pointed out that products with long positions in bitcoin from Canada, Europe and Germany saw combined inflows of $20 million.

Aun así, algunos observadores de mercado dijeron que las entradas para las posiciones cortas sugieren que los inversores esperan una tendencia a la baja en lugar de una recuperación continua en las siguientes semanas.

"Pawel Cichowski, head of agreements at the exchange XBO, said in a Telegram message: “People in the market believe that we have not reached the bottom yet. That's why they will try to increase their money by betting on bitcoin's fall”,"

"With signs of a global recession coming and the investment curve in returns on funds growing, no one knows for sure where bitcoin's price will go. However, based on ProShares statistics, people are choosing to wait for the worst," Cichowski added.

Inversores volvieron a invertir en productos cripto después de que retiraron más de $423 millones, tal como se informó previamente.

En medio de crecientes preocupaciones de inflación y recesión entre los inversores, los mercados han experimentado una ola de movimientos. En el foro europeo anual de bancos centrales, Jerome Powell, presidente de la Reserva Federal Estadounidense (FED), reiteró su compromiso a seguir subiendo las tasas para frenar la inflación.

Powell pointed out that the challenge from inflation is a bigger concern than interest rates when it comes to pushing the US economy into recession. Bloomberg Economics' recent forecasts put next year's recession at 38% in the United States.

Mientras tanto, el sentimiento de mercado se mantuvo mezclado entre los traders de acciones el miércoles. Hang Seng de Hong Kong, Nikkei 225 de Japón y Composite Shangai cayeron más del 1,2% desde que comenzó el miércoles, mientras que Stoxx 600 en Europa y DAX en Alemania aumentaron 1,3%.

Los futuros del mercado de precios de los Estados Unidos bajaron nominalmente, mientras que el crudo Brent volvió a la marca de $100 tras la caída por debajo de ese nivel del miércoles.

Marina Lammertyn realizó la traducción de este artículo.