Calamos Investments has successfully launched two innovative Bitcoin ETFs, the Calamos Bitcoin 90 Series Structured Alt Protection ETF (CBXJ) and the Calamos Bitcoin 80 Series Structured Alt Protection ETF (CBTJ). These funds offer investors unprecedented levels of downside protection while maintaining exposure to Bitcoin's potential upside, marking a significant milestone in bridging traditional finance with digital assets.
A New Era of Risk-Managed Bitcoin Exposure
The newly launched ETFs provide structured protection levels previously unavailable in the digital asset space. CBXJ offers 90% downside protection with an initial cap rate of 29.15%, while CBTJ provides 80% downside protection with a significantly higher initial cap rate of 51.50%. These products complement the firm's existing 100% protection ETF (CBOJ), creating a comprehensive suite of protected Bitcoin investment vehicles.
These funds represent the world's first Bitcoin ETFs with such substantial downside protection features, allowing investors to participate in cryptocurrency market movements while maintaining defined risk parameters. The structured protection approach helps mitigate the extreme volatility traditionally associated with Bitcoin investments.
How the Protected Bitcoin ETFs Work
The Calamos Protected Bitcoin ETF Suite utilizes a sophisticated options-based strategy to deliver its protection features. Each fund seeks to provide investment results that track the positive price return of Bitcoin up to a predetermined upside cap while protecting against specified percentages of losses over approximately one-year outcome periods.
Key Features of CBXJ (90% Protection ETF)
- Protection Level: 90% downside protection when held throughout outcome period
- Initial Cap Rate: 29.15%
- Outcome Period: February 4, 2025 - January 30, 2026
- Reference Asset: CBOE Bitcoin US ETF Index
- Annual Expense Ratio: 0.69%
Key Features of CBTJ (80% Protection ETF)
- Protection Level: 80% downside protection when held throughout outcome period
- Initial Cap Rate: 51.50%
- Outcome Period: February 4, 2025 - January 30, 2026
- Reference Asset: CBOE Bitcoin US ETF Index
- Annual Expense Ratio: 0.69%
Both funds are managed by Co-CIO Eli Pars and the Alternatives Team, leveraging Calamos's expertise in structured protection strategies that previously focused on traditional indices like the S&P 500®, Nasdaq-100®, and Russell 2000®.
Benefits of Structured Protection Bitcoin ETFs
These innovative funds offer several advantages for investors seeking Bitcoin exposure with reduced risk:
- Defined Risk Parameters: Investors know their maximum potential loss (10% or 20% before fees) when holding throughout the outcome period
- Upside Participation: Still captures Bitcoin's potential growth up to the predetermined cap
- Tax Efficiency: ETF structure provides potential tax advantages over direct Bitcoin ownership
- Liquidity and Transparency: Traded on major exchanges with daily pricing and visibility
- No Counterparty Risk: Unlike some crypto products, these ETFs don't expose investors to counterparty credit risk
The products are particularly suited for risk-averse investors who want digital asset exposure but are concerned about Bitcoin's notorious volatility. 👉 Explore more strategies for managing cryptocurrency investment risks.
Important Considerations for Investors
While these protected Bitcoin ETFs offer innovative risk management features, investors should understand several crucial aspects:
The target outcomes are only achieved if shares are purchased on the first day of the outcome period and held until the end. Investors purchasing after the outcome period begins may experience different results, including potential losses exceeding the protection levels.
The funds do not invest directly in Bitcoin but instead use options contracts linked to Bitcoin ETF indexes. This structure introduces additional complexities and risks beyond direct Bitcoin ownership.
All protection levels are calculated before accounting for fund fees and expenses, which will reduce overall returns. The 0.69% expense ratio is competitive for structured products but higher than many conventional ETFs.
The Growing Landscape of Crypto Investment Products
Calamos's launch reflects the continuing maturation of cryptocurrency investment vehicles within traditional finance frameworks. These protected Bitcoin ETFs follow the landmark approval of spot Bitcoin ETFs in early 2023, which opened the door for more sophisticated crypto investment products.
The structured protection approach builds upon Calamos's existing suite of protection ETFs for traditional indices, now expanded to digital assets. This development signals increasing institutional acceptance of cryptocurrencies as legitimate asset classes worthy of sophisticated risk management tools.
As regulatory clarity improves and investor demand grows, we can expect further innovation in crypto investment products offering various risk-return profiles tailored to different investor preferences.
Frequently Asked Questions
How do the protection levels work in these Bitcoin ETFs?
The protection levels (90% for CBXJ, 80% for CBTJ) mean the funds are designed to limit losses to no more than 10% or 20% respectively if held for the entire outcome period (approximately one year). This protection applies before accounting for fund fees and expenses and only works if shares are bought at the start of the period and held until the end.
What determines the cap rates for these protected Bitcoin ETFs?
Cap rates are determined based on market conditions, including Bitcoin price volatility, interest rates, and options pricing. The rates are set at the beginning of each outcome period and may change for subsequent periods based on prevailing market conditions.
Can I trade these ETFs throughout the year like regular ETFs?
Yes, these protected Bitcoin ETFs trade on exchanges like traditional ETFs. However, buying or selling during the outcome period rather than holding for the entire period may result in returns that differ significantly from the target outcomes, including potential losses exceeding the protection levels.
How do these protected Bitcoin ETFs differ from spot Bitcoin ETFs?
Unlike spot Bitcoin ETFs that directly hold Bitcoin and provide full exposure to both gains and losses, these structured protection ETFs use options strategies to provide capped upside with defined downside protection. They offer less potential upside but significantly reduced downside risk.
What happens at the end of the outcome period?
After each outcome period concludes, the funds reset with new cap rates and protection levels for the next period. Investors can choose to maintain their positions for the next outcome period or redeem their shares.
Are these protected Bitcoin ETFs suitable for all investors?
These products are designed for investors seeking Bitcoin exposure with limited downside risk. They may be particularly appropriate for conservative investors new to cryptocurrency or those looking to reduce portfolio volatility while maintaining some digital asset exposure.
Calamos Investments continues to expand its innovative ETF offerings, systematically launching additional products throughout 2025 to provide investors with diverse options for risk-managed Bitcoin exposure through familiar, regulated investment vehicles.