**ETHD Soars with 247% YTD Gain, Riding the Wave of Ethereum’s 14% Weekly Drop and Bearish Trends**
The Proshares UltraShort Ether ETF (ETHD) has made quite a splash in 2025, emerging as the top-performing exchange-traded fund with an impressive 247% year-to-date return. This success is largely due to its strategy of leveraging 2x inverse Ethereum futures, capitalizing on Ethereum’s ongoing downward trend. In fact, while Ethereum has experienced a 14% decline over the past week, ETHD has thrived, showcasing the effectiveness of inverse products in a bearish market.
Interestingly, the best-performing ETF this year is the -2x Ether ETF, $ETHD, which has surged by 247%. Following closely is another -2x Ether ETF, while the $UVIX (2x VIX) surprisingly ranks third. It’s been a tough year for some!
ETHD offers traders a unique opportunity by providing 2x daily inverse exposure to the Bloomberg Ethereum Index through futures derivatives. This means that if Ethereum drops by 10% in a day, ETHD is designed to rise by 20%. Instead of shorting Ethereum directly, ETHD utilizes futures contracts, which simplifies custody issues while still maintaining a synthetic bearish position. However, it’s important to note that the daily rebalancing of the fund can lead to volatility decay, which may erode returns during unpredictable or sideways market conditions.
Despite its remarkable performance this year, ETHD has seen a slight dip of 0.93% over the past six months. This decline highlights the challenges of sustaining inverse performance during Ethereum’s occasional rebounds.
According to the latest Ethereum ETF Tracker data from April 8, 2025, the market has been quite active, with a total net inflow of -$3.29 million and a total value traded of $356.04 million. The total net assets for Ethereum ETFs stand at $4.98 billion, with a market value ratio of 2.78%.
The bearish sentiment surrounding Ethereum has certainly fueled interest in inverse products. For instance, spot Ethereum ETFs like the iShares Ethereum Trust (ETHA) have faced significant outflows, losing $3.29 million in a single day and down 52% year-to-date. This stark contrast to ETHD’s performance underscores the different strategies at play in a cautious market.
When it comes to the mechanics and risks of inverse ETFs, it’s crucial to understand that ETHD does not short Ethereum directly but relies on futures contracts linked to its price. The fund resets daily, which means its long-term performance can diverge from a strict -2x Ethereum return due to compounding effects. This structure is ideal for traders looking to capitalize on short-term volatility, but it does come with risks like “volatility decay,” where daily rebalancing can diminish gains during turbulent market conditions.
In summary, while ETHD has enjoyed a remarkable surge in 2025, it has also faced a 0.93% decline over the last six months, reflecting the complexities of maintaining inverse performance amid Ethereum’s fluctuations. The T-Rex 2X Inverse Ether ETF (ETQ) follows closely with over 100% gains, further emphasizing the trend of inverse products thriving in a bearish crypto environment. As Ethereum continues to navigate its challenges, the landscape for ETFs remains dynamic and full of opportunities.
