Simply put
- Tidal Financial Group submitted an application for a leveraged alt season Crypto ETF on Thursday, marking it as one of three new filings.
- The concept of “alt alt season” seems to confound a number of industry experts.
- This fund focuses on the performance of XRP and Solana while sidelining Bitcoin and Ethereum.
In recent months, those behind Crypto Funds have been getting increasingly inventive, attempting to cater to a growing interest from investors in these types of products.
But what exactly is this “Altarte Season” funds about? It’s a relatively new concept.
Tidal Financial Group’s Daily Altalt Season Crypto ETFs filed with the Securities and Exchange Commission on Thursday, raising some eyebrows in the fund industry.
“What’s the difference between Altalt and Alt? (I was curious too),” tweeted Bloomberg ETF analyst James Seyffart, sharing a snapshot of the filing along with a brief explanation. “Alt excludes BTC while the other excludes both BTC and ETH.”
Tidal’s registration filing encompasses daily Quantify All Cap Crypto ETFs and aims to quantify twice as many ALT season Crypto ETFs daily. All three leveraged funds are targeting investors who can handle risk, promising potentially double the daily returns based on the cryptocurrencies they hold.
“Funds seek to deliver daily investment results, which sets them apart from most traditional exchange-traded funds,” the prospectus notes. “This also inherently carries more risk than non-leveraged options.”
According to Tidal’s prospectus, the Altalt Fund will initially track XRP and Solana. The ALT ETF focuses on these digital currencies alongside Ethereum, while all-cap strategies include those assets plus Bitcoin.
“Alt Seasons” refer to periods when Ethereum and other altcoin values surpass Bitcoin after BTC’s price increase. Conversely, “Alt Alt Seasons” describe phases where market activity transitions to mid-cap altcoins before moving to smaller tokens, with knock-on effects. Altarte seems positioned to take advantage of these later trends.
Each of the three funds aims to offer indirect exposure to digital assets through SWAP or options contracts tied to US-listed Spot Crypto ETFs, or by investing directly in crypto funds and derivatives involving cryptocurrencies.
In the last few months, more issuers have applied for leveraged crypto ETFs and spot funds that focus on various altcoin combinations. Bloomberg indicates that the SEC is currently considering over 90 of these applications as of late August.
The likelihood of approval received a boost recently when the SEC endorsed a new standard for product-based trusts, streamlining the approval process. This indicates a more favorable regulatory and political climate for such endeavors.
“We’re already seeing the cipher ETFs for double the Altarte season, and it’s not even October,” said Bloomberg senior ETF analyst Eric Bulknas, referencing current trends.
He humorously added: “[different] Story lol.”
