- Amplify seeks to launch SOL and XRP income ETFs.
- The ETFs aim to generate monthly income via covered calls.
- This marks a new step in crypto-based yield products.
Amplify ETFs has officially filed for two new exchange-traded funds (ETFs) focused on Solana (SOL) and Ripple (XRP). These proposed funds, named the SOL Monthly Option Income ETF and the XRP Monthly Option Income ETF, are designed to offer investors a new way to earn income from their crypto holdings.
What sets these ETFs apart is their covered call strategy. This involves holding the underlying crypto assets while selling call options against them. It’s a common income-generating method in traditional markets but relatively new in the crypto space. By applying this strategy to SOL and XRP, Amplify aims to provide monthly income while potentially lowering volatility for investors.
Covered Call Strategy Explained
A covered call is a popular options strategy that allows fund managers to earn premium income by selling calls on assets they already own. In the case of these ETFs, Amplify plans to hold either SOL or XRP and sell call options each month. If the market price of the token stays below the strike price, the ETF keeps both the asset and the option premium. If prices rise above the strike, gains are capped, but the premium is still retained.
This strategy is particularly attractive to investors looking for steady yield in the highly volatile crypto market . It combines the upside of crypto ownership with the consistency of income, appealing to both institutional and retail investors.
A Sign of Maturing Crypto Markets
The filing reflects a broader trend of mainstream financial products incorporating digital assets. Amplify is not the first to explore this area, but focusing on monthly options for SOL and XRP shows growing confidence in these altcoins’ market depth and liquidity.
If approved, these ETFs could become a significant tool for crypto investors seeking structured yield strategies, especially during periods of market consolidation. It’s also a clear indicator that crypto is gradually integrating with traditional finance in more sophisticated ways.
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