SEC approves listing rule change for six Volatility Shares triple-leveraged products

The U.S. Securities and Exchange Commission (SEC) approved a Cboe BZX Exchange rule change covering six triple-leveraged exchange-traded products from Volatility Shares. The October 2 order includes proposed Bitcoin and Ether ETFs. The six products target three times the daily movement in Bitcoin, Ether, gold, silver, crude oil and natural gas. Bloomberg ETF analyst Eric Balchunas called the decision a "big win" for Volatility Shares.

The new products will be structured as commodity-based trust shares under the Securities Act of 1933. Conventional ETFs are registered under the Investment Company Act of 1940. Cboe's existing generic listing standards allow certain commodity trusts to list without individual rule changes. However, those standards exclude products seeking leveraged or inverse exposure. Volatility Shares therefore needed the separate Cboe rule change that the SEC has now approved.

The funds are expected to use first- and second-month futures contracts. Cash and cash equivalents are expected to serve as collateral. The SEC order does not specify when trading will begin. The approval appears to provide a route to triple-leveraged exposure without directly resolving the SEC's concerns about funds registered under the 1940 Act.

The approval comes less than a year after the SEC raised serious concerns about highly leveraged ETFs. In December 2025, SEC staff told Direxion that staff would not substantively review filings seeking more than 200% leveraged exposure until Rule 18f-4 concerns were addressed. The rule's value-at-risk framework generally limits leveraged and inverse funds to about twice the underlying exposure, subject to a narrow grandfathering exception.

In October 2025, the SEC questioned whether proposed triple-leveraged and quintuple-leveraged ETFs complied with Rule 18f-4 after Volatility Shares filed for 27 highly leveraged products. By December, the SEC had warned issuers including Direxion, ProShares, Tidal and Volatility Shares that certain triple-leveraged and quintuple-leveraged proposals could violate federal leverage limits. Those warnings prompted some withdrawals. The latest approval does not necessarily signal that the SEC has abandoned its concerns about triple-leveraged and quintuple-leveraged exposure. The approval highlights how a product's regulatory structure can determine which rules apply.

Volatility Shares already offers the 2x Bitcoin ETF (BITX) and the 2x Ether ETF (ETHU). The new approval could extend crypto ETF leverage beyond existing levels. Triple-leveraged daily exposure magnifies both gains and losses. Daily compounding can cause longer-term returns to diverge sharply from three times the underlying asset's performance.