The financial world is witnessing a groundbreaking innovation in digital asset investing with Calamos unveiling plans for the Calamos Bitcoin Structured Alt Protection ETF (CBOJ)—positioned as the world’s first Bitcoin ETF offering 100% downside protection. This development marks a pivotal shift in how investors can gain exposure to Bitcoin while significantly reducing risk, aligning with growing demand for regulated, structured crypto investment vehicles.
A New Era in Crypto Risk Management
John Koudounis, President and CEO of Calamos, emphasized the firm’s commitment to pioneering risk-managed investment solutions:
“I am excited to announce the world's first 100% downside protected Bitcoin ETF - CBOJ. This is consistent with our history of groundbreaking innovations in risk management.”
CBOJ builds upon the success of Calamos’ Structured Protection ETF series, launched in 2024, which introduced comprehensive downside protection strategies tied to major U.S. equity indices such as the S&P 500®, Nasdaq-100®, and Russell 2000®. By extending this proven framework to Bitcoin, Calamos is addressing a critical pain point: extreme volatility.
Many investors have long been intrigued by Bitcoin’s explosive growth potential but deterred by its unpredictable price swings. CBOJ aims to bridge that gap by allowing investors to participate in Bitcoin’s upside—capped at a predetermined rate—while shielding them from losses over a defined outcome period.
👉 Discover how structured protection strategies are reshaping crypto investing.
How CBOJ Works: Structure and Mechanics
CBOJ is an actively managed ETF that does not invest directly in Bitcoin. Instead, it uses a combination of U.S. Treasuries and options linked to the CBOE Bitcoin US ETF Index to replicate Bitcoin’s price performance in a regulated, transparent environment.
Key features of the ETF include:
- 100% Downside Protection: Investors who hold shares through the full outcome period are protected from negative returns of the underlying Bitcoin index.
- Annual Reset Mechanism: The ETF resets each year, introducing a new cap and protection period, allowing ongoing participation with updated market conditions.
- Cap Rate: The maximum return achievable over the outcome period. This rate will be announced on January 22, 2025, following market close.
- Outcome Period: January 22, 2025 – January 31, 2026 (approximately 12 months).
- Expense Ratio: 0.69%, competitive for a structured, actively managed product.
- Indefinite Holding: Shares can be held beyond the outcome period, though protection applies only if held from start to finish.
Portfolio management is led by Co-CIO Eli Pars and the firm’s Alternatives Team, leveraging Calamos’ deep expertise in derivatives and structured products.
Targeting Investor Demand for Safer Crypto Access
Matt Kaufman, Head of ETFs at Calamos, highlighted the strategic rationale behind CBOJ:
“Many investors have been hesitant to invest in bitcoin due to its epic volatility. Calamos seeks to meet advisor, institutional and investor demands for solutions that capture bitcoin's growth potential while mitigating the historically high volatility and drawdowns of this fast-growing and high performing asset.”
This product is particularly appealing to:
- Wealth advisors seeking client-friendly crypto exposure.
- Institutional investors needing risk-controlled entry points.
- Retail investors wary of crypto’s wild price swings.
By packaging Bitcoin’s upside within a traditional ETF wrapper backed by Treasuries and options, CBOJ offers a compliant, tax-efficient, and accessible pathway into digital assets.
👉 Learn how institutional-grade risk management is transforming crypto portfolios.
Core Keywords and Market Relevance
This launch taps into several high-intent search themes in today’s investment landscape:
- Bitcoin ETF
- Downside protection
- Structured ETF
- Crypto risk management
- Bitcoin volatility
- CBOJ ETF
- 100% capital protection
- Regulated crypto investing
These keywords reflect growing interest in hybrid financial products that merge innovation with safety—a trend accelerating as mainstream finance embraces digital assets.
Frequently Asked Questions (FAQ)
What is downside protection in an ETF?
Downside protection means the fund is designed to shield investors from losses over a specific period. In CBOJ’s case, shareholders who hold through the full outcome period are protected from negative returns of the reference index—before fees and expenses.
Does 100% protection guarantee no losses?
While the fund seeks to deliver 100% downside protection, there is no absolute guarantee. The protection is contingent on holding shares for the entire outcome period. Investors who buy after the start date may not benefit from full protection and could lose principal.
How does CBOJ generate returns without owning Bitcoin?
CBOJ uses financial derivatives—specifically options on the CBOE Bitcoin US ETF Index—to mirror Bitcoin’s price movements. It combines these with low-risk U.S. Treasuries to fund the strategy and provide capital preservation.
Can I sell my shares before the outcome period ends?
Yes, but doing so may result in losses. The 100% downside protection only applies if you hold shares from the beginning to the end of the outcome period. Early sellers are exposed to market fluctuations.
What happens after the outcome period ends?
The ETF resets annually. A new cap rate is set, and a fresh 12-month protection period begins. Investors can continue holding shares or exit at any time.
Is CBOJ suitable for long-term investors?
Yes, especially for those seeking periodic exposure to Bitcoin with reduced risk. The annual reset allows investors to continuously engage with Bitcoin’s upside while maintaining a disciplined risk framework.
Risks and Considerations
While CBOJ offers compelling benefits, investors must understand the risks involved:
- Digital Assets Risk: Bitcoin is a relatively new asset class with evolving regulatory, technological, and adoption challenges.
- Cap Limitation: Gains are capped; investors won’t benefit from returns exceeding the cap.
- Derivatives Risk: The fund’s use of options introduces counterparty and valuation complexities.
- Market Volatility: High volatility can impact liquidity and pricing efficiency.
- New Fund Risk: As a newly launched ETF, it may face initial liquidity or tracking challenges.
As stated in regulatory disclosures: An investment in the Fund is subject to risks, and you could lose money. The Fund is not a bank deposit and is not FDIC-insured.
👉 Explore secure ways to access digital assets with regulated financial products.
Final Thoughts
The launch of CBOJ represents a significant milestone in the convergence of traditional finance and digital assets. By offering regulated, structured exposure to Bitcoin with full downside protection, Calamos is setting a new benchmark for crypto ETFs.
For investors seeking to harness Bitcoin’s growth without enduring its rollercoaster volatility, CBOJ could be a game-changing solution—blending innovation, safety, and accessibility in one powerful financial instrument.