According to the source, Europe will list 3x leveraged Bitcoin (BTC) and Ethereum (ETH) ETFs amid a broader crypto market drawdown, introducing products that target triple the daily move of the underlying assets. According to the U.S. SEC Investor Bulletin on Leveraged and Inverse ETFs, these funds reset exposure daily and can experience compounding effects and volatility drag, causing multi-day returns to diverge from 3x. According to FINRA Regulatory Notice 09-31, leveraged ETFs are designed for short-term tactical trading and daily rebalancing rather than long-term holding, and they typically carry higher fees and risks than conventional ETFs. According to ESMA Guidelines on ETFs and other UCITS issues, complex leveraged products require prominent risk disclosures in Europe, and may exhibit wider bid-ask spreads and larger tracking differences that traders must consider.

According to @EricBalchunas, the 2x Rigetti Computing ETF has surged about 1,000% since its launch six months ago, reflecting exceptional leveraged performance over the period, source: Eric Balchunas on X, Oct 2, 2025. He notes the ETF’s gain is roughly 3x the underlying stock because daily compounding amplified returns beyond the stated 2x multiple, source: Eric Balchunas on X, Oct 2, 2025. He explains this outcome is the opposite of volatility drag and occurs when the underlying rallies in a relatively smooth path, source: Eric Balchunas on X, Oct 2, 2025. He cautions traders that such path-dependent outperformance is not guaranteed and should not be relied upon, source: Eric Balchunas on X, Oct 2, 2025. For crypto-market participants using daily-leveraged ETFs, the same compounding versus volatility drag mechanics apply to strategy design and risk management, source: Eric Balchunas on X, Oct 2, 2025.