World's first SUI ETF approved! 21Shares 2x leveraged product listed on Nasdaq

ETF issuer 21Shares launches the world’s first exchange-traded product tracking the price of Sui. The 21Shares 2x SUI ETF (Ticker: TXXS) has been approved for trading on Nasdaq. This is a leveraged product designed to deliver 200% of Sui token’s daily returns. TXXS is the 74th crypto ETF launched this year and the 128th overall.

Nasdaq Welcomes World’s First Leveraged Sui ETF

(Source: 21Shares)

The 21Shares 2x SUI ETF (Ticker: TXXS) was approved for trading on Nasdaq on Thursday, marking a significant milestone for the Sui ecosystem’s entry into traditional financial markets. This leveraged product aims to deliver 200% of Sui token’s daily returns. This means if Sui rises 1% in a day, TXXS will theoretically rise 2%; conversely, if Sui drops 1%, TXXS will drop 2%.

Russell Barlow, CEO of 21Shares, said: “The widespread adoption of digital assets depends on whether the market can provide consumers with easy-to-use technology and investors with products designed to enhance returns. With this launch, 21Shares is among the winners seizing the opportunity and leading blockchain technology into the next era—an era dominated by simplicity.”

This statement reveals 21Shares’ product philosophy: packaging complex blockchain technology with traditional financial tools, enabling mainstream investors to participate without understanding Sui’s technical details. For traditional investors unfamiliar with crypto wallets, private key management, and decentralized exchanges, the SUI ETF offers a familiar and secure investment channel.

Bloomberg Senior ETF Analyst Eric Balchunas pointed out that it’s rare for the first crypto ETF to be a leveraged product. Usually, the market launches spot ETFs first to establish liquidity and investor awareness before introducing leveraged, inverse, or other derivative products. But for Sui, the opposite is true—the first ETF to go live is a leveraged product.

This strategy may be based on several considerations. First, 21Shares may judge that Sui investors are mainly high-risk, crypto-native traders with strong demand for leveraged products. Second, leveraged ETFs typically have higher trading volume than spot ETFs, generating more management fee income for the issuer. Third, 21Shares may have encountered delays in the approval process for Sui spot ETFs, so they launched a leveraged product first to seize the market opportunity.

Sui Ecosystem Boom: $10 Billion Trading Volume Supports Valuation

Sui is a Layer-1 blockchain based on the Move programming language. It uses a proof-of-stake consensus mechanism and enables peer-to-peer transactions, increasing transparency and eliminating the need for intermediaries. Its native token SUI is used for transaction fees, network governance, and staking. Sui is developed by Mysten Labs, whose core team comes from Meta’s Diem (formerly Libra) project, with deep blockchain technical expertise.

According to data released Thursday, Sui’s 30-day DEX trading volume has surpassed $10 billion, and it has processed over $180 billion in stablecoin transfers for four consecutive months. These figures provide a solid fundamental basis for the SUI ETF launch, as they prove Sui is not just a speculative token but a blockchain ecosystem with real transaction activity and use cases.

Sui Ecosystem Key Data

30-Day DEX Trading Volume: Over $10 billion

Stablecoin Transfer Volume: Over $180 billion for four consecutive months

Consensus Mechanism: Proof of Stake (PoS)

Technical Features: Move programming language, high throughput, low latency

A $10 billion DEX trading volume means Sui’s decentralized exchange ecosystem is extremely active. By comparison, many larger blockchains have DEX trading volumes only in the billions. This high level of activity shows Sui is attracting real users and liquidity, not just speculative hype.

The $180 billion in stablecoin transfers is even more convincing. Stablecoin transfers typically represent real payment and settlement activity rather than pure speculation. This level of stablecoin activity shows Sui is becoming infrastructure for cross-border payments, DeFi lending, and other financial applications. For SUI ETF investors, these data points provide evidence of the token’s long-term value.

In May, 21Shares filed a registration statement for a Sui spot ETF with the SEC and also announced a “strategic partnership” with Sui to collaborate on product development, research reports, and other initiatives. This strategic partnership shows 21Shares’ commitment to Sui is not just a single product but a long-term ecosystem build. While the spot ETF application has not yet been approved, its eventual launch is only a matter of time.

Leveraged ETF Risk Warning & Regulatory Red Line

Because the use of derivatives entails high risk, leveraged ETFs are typically chosen by experienced traders for short-term trading. In fact, the SEC recently halted the launch of 3x and 5x leveraged ETFs in preparation. According to ETF.com, “While 2x leverage has long been viewed as the cap under rule 18f-4, some issuers have argued there are loopholes in the derivatives rule’s language. But the SEC has made it clear such interpretations are unacceptable.”

This background makes 21Shares’ decision to launch a 2x leveraged rather than a higher-leverage SUI ETF a prudent one. 2x leverage is the current maximum the SEC is willing to approve; any product exceeding this faces regulatory hurdles. For investors, it is crucial to understand how leveraged ETFs work and their risk characteristics.

Leveraged ETFs rebalance daily to maintain their target leverage. This mechanism can result in “leverage decay” in sideways markets: even if the underlying asset price is flat over time, the leveraged ETF’s value declines due to daily volatility. For example, if Sui rises 5% today and falls 5% tomorrow, the price is almost back to the starting point after two days (actually slightly lower at 99.75%), but the 2x leveraged ETF drops to 99% (up 10% to 110 the first day, then down 10% to 99 the second day).

This effect is particularly pronounced in the highly volatile crypto market. As a relatively new blockchain, Sui’s token may be more volatile than Bitcoin or Ethereum. This makes TXXS better suited for intraday or short-term trading rather than long-term holding. Investors must recognize that even if they are optimistic about Sui’s long-term prospects, holding a leveraged ETF may result in losses due to decay.

74th Crypto ETF Marks Market Frenzy Expansion

According to Bloomberg, TXXS is the 74th crypto ETF launched this year and the 128th overall. On Thursday, Bloomberg Senior ETF Analyst Eric Balchunas posted on X: “We expect another 80 new cases in the next 12 months.” This explosive growth shows the crypto ETF market is rapidly expanding and diversifying.

When Bitcoin spot ETFs were approved at the start of 2024, there were only about 50 crypto ETFs, most of which were Bitcoin futures ETFs. In just a year and a half, that number has grown by more than 150%. More importantly, the types of ETFs are rapidly expanding, from the initial Bitcoin and Ethereum to now covering multiple chain tokens like Solana, XRP, Sui, and even meme coins like Dogecoin.

21Shares has played an important role in this ETF wave. The company was acquired last month by crypto trading firm FalconX for an undisclosed price, around the same time it launched a leveraged Dogecoin ETF. This rapid product innovation shows 21Shares is pursuing an aggressive market expansion strategy, aiming to seize the initiative in every emerging crypto asset class.

The forecast of 80 new ETFs in the next 12 months means the total number of crypto ETFs could exceed 200 by the end of 2026. This rapid expansion has a dual impact: positively, it provides investors with more choices and refined investment tools; negatively, it may lead to excessive market fragmentation, with individual ETFs unable to achieve ideal liquidity and scale.

Frequently Asked Questions (FAQ)

What is the SUI ETF?

The SUI ETF is an exchange-traded fund tracking the price of Sui blockchain’s native token. Investors can buy the SUI ETF via regular brokerage accounts without holding Sui tokens directly or managing a crypto wallet. 21Shares’ TXXS is the first SUI ETF, designed with 2x leverage to deliver 200% of Sui’s daily returns.

Who is the 2x Leveraged SUI ETF suitable for?

It is suitable for experienced short-term traders and not recommended for long-term holding. Leveraged ETFs rebalance daily, resulting in “leverage decay”: even if Sui’s price is flat, the ETF’s value will decline in a sideways market. It’s only suitable for professional traders with a clear view of Sui’s short-term price movement.

Why is Sui worth launching an ETF for?

Sui’s 30-day DEX trading volume exceeds $10 billion, and it has processed over $180 billion in stablecoin transfers for four consecutive months, indicating high ecosystem activity. Sui uses the Move programming language and innovative consensus mechanisms, earning market recognition for its technical leadership.

Why did 21Shares launch a leveraged ETF before a spot ETF?

Possibly because the approval process for leveraged ETFs is faster, or because Sui investors are considered to have a higher risk appetite and strong demand for leveraged products. 21Shares filed for a Sui spot ETF in May and is expected to launch a spot version in the future.

How do I buy TXXS?

You can buy it through any broker that supports Nasdaq trading by entering the ticker “TXXS,” just like buying a stock. It is recommended to start with a small position to get familiar with leveraged ETF characteristics and set strict stop-losses to control risk.