Hedge Your Bets: New Long-Short ETFs Capitalize on Bitcoin-Gold Rivalry

In the world of exchange-traded funds (ETFs), the long-simmering conflict between Bitcoin proponents and conventional gold investors is about to burst forth.

Wall Street is bringing this to the public.

In a strategic maneuver, Tidal Financial Group presented investors with a compelling opportunity by initiating two long-short transactions last week. One transaction juxtaposes the world's largest cryptocurrency against the precious metal, while the other does the reverse.

These novel ETFs, offered under the Battleshares name, attempt to capitalize on the current conversation about what people should do with their money in light of their worries about trade wars, geopolitical tensions, and loose fiscal and monetary policies.

Since Bitcoin's debut during the 2008 crisis, there has been a sharp ideological divide between institutional and retail investors.

This ideological gulf has only grown wider over the past year, as both asset classes have had large rises, driven by narratives that couldn't be more different.

According to the documents presented to the US Securities and Exchange Commission , the proposed ETFs would use various methods, including swaps, options, and asset short selling.

The offering, though, has some naysayers.

As the trade war heightened concerns about the security of US assets, gold established new records for haven demand this year.

Meanwhile, Bitcoin fell in the tariff-spurred upheaval in early April, following the lead of riskier stocks.

With the US government fully supporting digital finance, Bitcoin has made a triumphant comeback, coinciding with the White House's efforts to negotiate trade agreements.

Wealth managers have suggested using gold and cryptocurrency as smart ways to diversify investments, helping to protect against possible currency drops and disruptions in the traditional financial system.

These claims are quite audacious, and the primary driver may very well be the anxiety of missing opportunities.

This year, over $14 billion has flowed into four major gold ETFs, whereas $8 billion has been allocated to the top four Bitcoin ETFs.