Calamos to Launch Bitcoin ETF with 100% Downside Protection

Calamos Investments is set to launch a Bitcoin exchange-traded fund (ETF) with a unique feature: 100% downside protection. The ETF, named CBOJ, will debut on the Chicago Board Options Exchange (CBOE) on January 22, aiming to provide exposure to Bitcoin while addressing its notorious price volatility.

Bitcoin has often been seen as a risky investment due to its dramatic price swings, deterring more cautious investors. However, CBOJ seeks to change this by offering a product that ensures investors do not lose money, even if the value of Bitcoin declines. The fund achieves this protection by combining U.S. Treasury bonds with options tied to the CBOE Bitcoin US ETF Index, creating a regulated and transparent method of accessing Bitcoin exposure with minimized risk.

CBOJ builds on the success of Calamos’ Structured Protection ETF series, which launched in 2024. This series provided similar protection for stock indices like the S&P 500 and Nasdaq-100. CBOJ’s structure is designed to offer downside protection, resetting annually, which means that each year investors will receive a new cap on potential gains while maintaining full protection against losses for the next 12 months.

According to Matt Kaufman, Head of ETFs at Calamos, “Many investors have been hesitant to invest in Bitcoin due to its epic volatility. Calamos seeks to meet advisor, institutional, and investor demands for solutions that capture Bitcoin’s growth potential while mitigating the historically high volatility and drawdowns of the asset.”

This move comes as part of a wider trend in the ETF industry, where several major exchanges, including Calamos, are turning to new derivatives-based Bitcoin ETFs to offer cautious investors a safer way to navigate the cryptocurrency’s price fluctuations.

In essence, CBOJ offers investors a way to gain exposure to Bitcoin without owning the cryptocurrency directly, while significantly reducing risk through its protective structure.