First Trust Advisors has introduced two Bitcoin strategy exchange-traded funds (ETFs) aimed at providing structured exposure to Bitcoin while capping losses and earning yield. The FT Vest Bitcoin Strategy Floor ETF (BFAP) targets limited drawdown risk of approximately 15%, responding to a growing demand among traditional investors seeking bitcoin-linked ETFs, which have become popular despite concerns over sharp market fluctuations. In addition, the FT Vest Bitcoin Strategy & Target Income ETF (DFII) is designed to generate a yield surpassing that of short-dated U.S. Treasurys by at least 15%, utilizing strategies like selling call options to capitalize on Bitcoin's volatility. First Trust's move aligns with recent trends where Bitcoin ETFs, launched in January 2024, manage significant assets as investors explore innovative fund structures to navigate market risks. Other asset managers, including Grayscale and Bitwise, have also launched Bitcoin-focused ETFs to enhance investor confidence and manage risk, amidst recent market turbulence following geopolitical events.

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