HYPE ETF: 21Shares Files for 2x Leveraged ETF in the U.S.

How the 2x HYPE ETF Could Boost DeFi and Leveraged Crypto Trading

Could a new leveraged Exchange Traded Fund become the next big thing in crypto investing? 

21Shares is looking to find out with its latest filing for a 2x HYPE ETF in the U.S. 

If approved, this would be the first U.S.-listed leveraged Exchange traded fund to track a live decentralized finance protocol like Hyperliquid.

21Shares Expands Its DeFi Products

The company has filed with the U.S. Securities and Exchange Commission (SEC) for a leveraged fund aiming to deliver double the daily returns of the Hyperliquid Index. 

This crypto product is meant for traders who want to amplify gains by tapping into platform's on-chain activity.

Bloomberg ETF analyst Eric Balchunas called it “so niche it might just win,” comparing it to the early rise of smart beta and currency-hedged Exchange Traded Funds. 

Source: X (formerly Twitter) 

If approved, U.S. investors would get a new way to join the ecosystem, adding to 21Shares’ growing line of crypto products, including its recently launched DOGE ETF.

European Success Sets a Precedent

21Shares has already listed the ETP of this altcoin on the SIX Swiss Exchange. This European launch lets institutional investors access Hyperliquid tokens without wallets or on-chain custody. 

The timing was perfect, as the platform also reported its strongest revenue month so far, showing growing interest in the network.

How the 2x HYPE ETF Works

• The planned fund uses Hyperliquid’s perpetual futures system within a traditional 40-Act, daily-reset structure. 

• By relying on swaps instead of direct custody, it adds new layers of funding and counterparty risk.

• Analysts forecast its initial capacity to range from $500 million to $1.5 billion, depending on this altcoin's market liquidity.

Investors would gain increased daily returns, but should keep in mind that leveraged crypto investment products are riskier. Therefore, this investment product would be more appropriate for active traders rather than long-term investors.

The Increasing Demand for Hyperliquid

Hyperliquid, which launched in 2023, is a Layer 1 blockchain with a decentralized perpetual futures exchange. Its token, HYPE, is used for fees and discounts on the platform. 

Other companies such as Bitwise and VanEck are also introducing this altcoin into mainstream finance via ETFs and ETPs, making it more visible.

Bitwise’s spot HYPE ETF will hold tokens directly and allow in-kind redemptions.VanEck is planning a staking ETF in the U.S. and a European ETP, highlighting rising demand for HYPE even before it appears on major U.S. exchanges like Coinbase.

What This Means for Investors

The 21Shares 2x HYPE ETF shows how crypto-themed investment products are moving into mainstream finance. Analysts say crypto investment products like this could attract billions in the next few years, much like smart beta and currency-hedged ETFs did in the past.

For investors, this exchange traded fund offers a way to get strong exposure to a fast-growing DeFi protocol while staying within traditional finance rules. SEC approval will be an important milestone to watch in the coming months.