BITU's Decay Problem: Why This Bitcoin ETF Lost 31% While Bitcoin Fell Just 10%

The article explains why ProShares Ultra Bitcoin ETF (BITU), a swaps-based 2x daily product, has underperformed Bitcoin due to volatility decay and daily resets. Year-to-date Bitcoin is down ~10% while BITU is down ~31%; over the trailing year Bitcoin is down 17% versus BITU’s 53% loss. The fund tracks daily moves, so choppy markets and multi-day reversals compound losses for buy-and-hold holders, while clean trending rallies can produce near-2x returns (Bitcoin +16% in the past month, BITU ~+30%). Key monitoring metrics include 30-day realized BTC volatility, the VIX, Bitcoin spot price action, Fed policy and 10-year yields, and ProShares’ fund disclosures. The takeaway: BITU may work for day trading or strong trends but is risky for longer-term holders.