The ProShares Short Bitcoin Strategy ETF, which allows traders to bet on a fall in bitcoin futures, hit a record low on Tuesday as the cryptocurrency surged on growing optimism that the launch of an exchange-traded fund tracking bitcoin is imminent. Bitcoin, the world’s largest cryptocurrency, hit an 18-month high on Tuesday, extending Monday’s 10 per cent surge, on speculation over the likely approval of a spot bitcoin ETF that was fueled by BlackRock’s iShares ETF listing on the website of clearing house DTCC. The ProShares fund had hit its peak of $45.61 a little over a year ago as crypto assets tumbled following the collapse of FTX, but struggled to hold on to gains this year amid the sharp recovery in bitcoin. The fund fell nearly 10 per cent to $16.18 in early trading, hitting a record low, and has shed 59.3 per cent so far this year. The ProShares Short Bitcoin ETF, which has $62.98 million in net assets, is still on track for its second month of inflows, according to Lipper data, as investors continue to pile into the fund even as prices fall. “A lot of people think this rally is a short squeeze – we have no real news coming out and a lot of anticipation around the SEC’s approval or disapproval of these spot ETFs and people are getting ahead of themselves,” said Lucas Kiely, chief investment officer at digital wealth platform Yield App. “Ultimately, the market is again buying the rumor and selling the fact and the BTC short ETF is the only way for investors to express the view BTC is going to sell off.” Kiely added that people could also be trying to hedge their bitcoin. “They’ve seen a price pump that they want to lock in so they buy the ETF to hedge their position.” Meanwhile, other bitcoin-linked ETFs, like the ProShares Bitcoin Strategy ETF that tracks bitcoin futures, and Valkyrie Bitcoin Miners ETF, gained more than 9 per cent each. The Valkyrie Bitcoin and Ether Strategy ETF was up 9.4 per cent, leading gains among recently launched funds that track Ether futures.