Evolve Funds, a Toronto-based firm, has filed a preliminary prospectus to launch Canada's first leveraged crypto ETFs, aiming to bring back investors who have been drawn to the US market. The proposed Evolve Levered Bitcoin ETF and Evolve Levered Ether ETF would offer 1.25x exposure to Bitcoin and Ethereum, lower than the 2x leverage offered by some US funds. Evolve intends to use cash borrowing instead of derivatives, and the funds will rebalance monthly. The move comes after outflows from Canadian crypto ETFs lasted five months, with investors pulling over C$1.1 billion. The Canadian government has also raised concerns about the use of cryptocurrencies in illicit activities.



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