Your day-ahead look for Oct. 5, 2026
By Omkar Godbole|Edited by Jamie CrawleyOct 5, 2026, 7:14 a.m. EDT4 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShowThis is an excerpt from CoinDesk newsletter 'Daybook.' Sign up here, if you haven't already.
Traders who may have missed the early tumultuous years of bitcoin's BTC$86,028.63 now have a new investment opportunity.
On October 2, the SEC approved a rule change by Cboe BZX that permits the launch of six ETFs by Volatility Shares, each designed to provide three times the daily return of the respective underlying assets. In addition to bitcoin and ether, these ETFs will also cover commodities like gold, silver, crude oil, and natural gas.
This represents a significant development because previously, crypto funds in the U.S. were limited to a maximum leverage of 2x.
However, the funds are not yet available for trading, as the issuer still awaits the SEC's confirmation of its registration statement, with no set deadline for this process. The ETFs will be based on regulated futures linked to bitcoin and ether rather than on the actual cryptocurrencies.
Industry experts have noted that these funds are tailored for specific trading strategies.
"Leveraged ETFs are primarily for trading purposes, not for long-term investment," stated Eric Balchunas, Senior ETF Analyst at Bloomberg, on X.
These funds will need to rebalance daily to maintain their 3x leverage. This requirement compels them to purchase more futures after price increases and sell off after declines—mechanical trading patterns that typically occur near closing time and can enhance intraday volatility. As the size of the fund increases, so does its market impact. However, this daily reset also means that returns over multiple days can significantly deviate from 3x, sometimes even moving in the opposite direction.
Adam Back, CEO of Blockstream, expressed a more straightforward viewpoint: "Auto re-leveraging strategies lose capital during sideways market movements, particularly with an underlying asset that has high volatility... like bitcoin," he explained.
This capital loss is referred to as volatility decay. For example, if bitcoin increases by 10% one day and then decreases by 10% the next, it would end up with a net decrease of 1%. Conversely, a 3x fund would see a 30% gain followed by a 30% loss, resulting in a total decline of 9%. The more the price fluctuates back and forth without a clear trend, the more the leveraged fund underperforms and incurs capital loss.
Volatility Shares has acknowledged this risk, stating, "The more volatile the benchmark, the higher the risk of volatility decay," as mentioned in their preliminary prospectus submitted with the Form S-1 registration statement.
The prospectus also explicitly states the target audience for these investments.
"Investing in a 3x Bitcoin ETF is not suitable for every investor, may be considered speculative, and should only be undertaken by individuals who can accept the risk of total loss associated with such an investment," it cautioned.
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Crypto Daybook Americas - The latest moves in crypto markets, in contextMarket analysis for crypto traders and investors.PreviewSign upBy signing up, you will receive emails about CoinDesk products and you agree to our terms & conditions and privacy policy.Moreover, futures trading incurs additional costs. As contracts approach their expiration, the fund must sell them and acquire new contracts with later expiration dates, which often come at a higher price. This process creates a consistent drag on long-term returns, a point of criticism faced by standard bitcoin futures ETFs when they were first introduced in 2021.
Overall, this approval signifies that the cryptocurrency market is moving towards offering products comparable to traditional assets. While these ETFs may serve as effective tools for short-term traders and speculators, spot ETFs remain the most suitable option for long-term investors and those with a low risk tolerance. Stay vigilant!
Read more: For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today. For a comprehensive list of events this week, see CoinDesk's Crypto Week Ahead.
What’s trending
- Bitcoin is about to get a major bullish signal it hasn't had in over a year (CoinDesk): Bitcoin is down today, but its wider trend is telling a different story. The simple moving averages of its price over the past 50-, 100- and 200-days are one “crossover” away from a full bullish alignment it has not seen since 2025.
- Euro at 17-month low, dollar near pre-Liberation Day highs (Reuters): The euro sank to as low as $1.1161 in Asian hours, its weakest since May 2025, and was last down 0.62% at $1.1118. The US dollar index rose 0.39% to 102.33, after reaching 102.53, its highest level since April 10, 2025.
- Treasury yields inch lower as investors pare back Fed rate hike bets (CNBC): U.S. Treasury yields inched lower on Monday after a sharp selloff the week prior, as investors look ahead to the minutes from the Federal Reserve’s latest meeting.
- Ethereum investors are stuck in a two-week staking exit line. Here's why. (CoinDesk): Ether waiting to leave Ethereum’s staking system jumped more than fivefold in three days last week, pushing the exit queue to its longest wait of 2026. Most of the jump in withdrawals are from MetaMask, which disclosed a security incident on Sept. 30.
Today’s signal
Volmex's bitcoin implied volatility index. (TradingView)The chart shows daily swings in Volmex’s annualized 30-day bitcoin implied volatility index, BVIV, also known as the bitcoin VIX.
The index measures the expected price swings in the cryptocurrency.
The index has been largely flat between 35% and 40% since mid-September, suggesting traders are pricing in orderly market conditions despite the rally in the Dollar Index and Treasury yields.
Steady volatility is typically a feature of uptrends. At the same time, a prolonged period of calm usually precedes big moves.
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