Inverse Cryptocurrency ETFs Win Last Week: Here's Why
Bitcoin has tumbled about 15% last week (as of June 5, 2026) and slumped about 25% over the past month, about 30% so far this year and slipped below the $65,000 mark, extending a downturn that is raising fresh questions about its ability to protect investors from inflation.
Bitcoin's recent weakness is extremely eye-catching because it has occurred during a broader rally in risk assets. While U.S. equities have reached a series of record highs over the last month, Bitcoin has fallen sharply.
In line with Bitcoin, Ethereum has seen its prices slump 21.2% last week (as of June 5, 2026) and fall about 33% over the past month. So far this year, Ethereum has dropped about 46.8%.
What Led to the Slump?
The decline in Bitcoin has coincided with investor withdrawals from Bitcoin ETFs. Rising geopolitical uncertainty has boosted demand for traditional safe-haven assets, while renewed inflation concerns as well as strong May jobs data have triggered Fed rate hike bets.
Bitcoin continues to trade more like a high-risk asset than an inflation hedge. The asset is highly volatile in nature. When uncertainty rises, as in the current scenario of the Iran war, investors often reduce exposure to volatile assets.
Moreover, the Fed rate hike bets will result in high rates, which are a negative scenario for growth and risky assets like tech stocks and cryptocurrencies. While Bitcoin has often been touted as a hedge against inflation amid market turbulence, its recent weakness is challenging that narrative.
Instead of benefiting from these developments, the cryptocurrency has continued to slide, casting doubt on some of its most widely cited investment merits, per Bloomberg, as quoted on Yahoo Finance.
Need for Stronger Regulations?
Bitcoin and other cryptocurrencies have long been in a questionable position due to a lack of regulation. A stronger regulatory framework is likely needed to maintain persistent investor confidence in Bitcoin.
Profit-Taking After a Massive Rally
Bitcoin surged to record highs earlier, reaching around $126,000 in October. Some investors are locking in gains after the strong run-up, contributing to the recent pullback.
Further Slump Possible?
Possible. This is especially true given Friday's jobs-data-led market rout. Note that chip stocks lost more than $1 trillion in market value on Friday as the AI trade buckled, per Yahoo Finance.
In 2013, Bitcoin surged to new highs before collapsing more than 80%. In 2017, the cryptocurrency reached nearly $20,000 before crashing to around $3,000 during the following bear market, a slump of about 84%. In 2021, Bitcoin hit $69,000 before falling to nearly $15,000 in 2022, erasing more than 75% of its value, per Binance.com.
Winning Inverse ETFs in Focus
No wonder, inverse cryptocurrency ETFs have logged solid gains last week. Below we highlight some of the winning products.
ProShares UltraShort Ether ETF ETHD – Up 48.7%
T-Rex 2X Inverse Bitcoin Daily Target ETF BTCZ – Up 38.7%
ProShares UltraShort Bitcoin ETF SBIT – Up 38.2%
GraniteShares 2x Short COIN Daily ETF CONI – Up 33.8%
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This article originally published on Zacks Investment Research (zacks.com).
Source Zacks-com
