Shorting ETH Becomes the “Golden” ETF Strategy of 2025, Delivering Outsized Returns to Investors

Amid a steep decline in the cryptocurrency market, two US-based exchange-traded funds (ETFs) betting against the price of Ethereum (ETH) have emerged as performance stars, delivering returns that far exceeded investors’ expectations.

According to the latest data from veteran ETF analyst Eric Balchunas, the ProShares UltraShort Ether ETF (ETHD) is leading the list of best-performing ETFs of 2025 with a gain of nearly 247% since the start of the year. The fund is designed to mirror twice the daily decline of the Bloomberg Ethereum Index, meaning if ETH falls 1% during the day, the fund will rise 2%.

ETHD’s impressive performance is a testament to the effectiveness of a short-selling strategy, especially since the price of ETH has fallen 51% since the beginning of January. Investors betting on the market’s decline have not only hedged their risk, but also maximized their returns in a volatile year.

Not only that, the second-best performing ETF on the US market is also an ETH short product: the T-REX 2X Inverse Ether Daily Target ETF from Rex Shares. This fund operates similarly to ETHD, but instead of mirroring the Bloomberg index, it sells spot ETH directly, and has grown about 220% YTD, just behind the leader.

“This is brutal. The best ETF this year is ETHD, up 247%. Number two is another inverse ETF with ether,” Balchunas wrote on social media platform X (formerly Twitter).

While traditional investors may shy away from highly leveraged products due to their high risk and volatility, 2025 is showing the other side: when timed correctly, shorting crypto can be an extremely profitable lever.

The success of short-selling ETFs like ETHD and T-REX 2X once again underscores the need to diversify your investment strategy, especially in today’s volatile and uncertain market environment for digital assets.