Nicholas Financial Corporation, a boutique asset manager specializing in fixed-income and alternative strategies, has filed with U.S. regulators for a novel Bitcoin exchange-traded fund (ETF) that will exclusively hold Bitcoin during U.S. market off-hours. The proposed fund, dubbed "Bitcoin After Dark," aims to capitalize on historical data showing that a disproportionate share of Bitcoin's price gains occur overnight in U.S. Eastern Time.
The fund's core operational strategy involves buying Bitcoin exposure at the U.S. market close (4:00 p.m. ET) and selling it at the open (9:30 a.m. ET). During the daytime when U.S. markets are active, the fund will rotate its holdings into low-risk U.S. Treasuries to generate yield and preserve capital.
Bloomberg senior ETF analyst Eric Balchunas, who first highlighted the filing, described it as an innovative product born from empirical analysis. He noted that research from last year indicated "a significant portion of BTC returns occurred overnight," suggesting such a time-specific strategy could potentially yield higher returns. Balchunas added that this application illustrates a broader trend in the ETF industry: "The ETF industry will try everything you can imagine, even things you can't imagine... People need to be free to try new things. That's how the next big innovation comes about."
The historical pattern behind the strategy has been observed across multiple studies and datasets spanning 2015–2025. During U.S. nighttime hours, when market liquidity tends to be thinner and Asian trading activity overlaps, Bitcoin has historically generated stronger average returns. However, analysts caution that these periods also exhibit higher volatility and risk, and the edge has narrowed as Bitcoin's market has matured. Balchunas also noted that this development doesn't diminish the impact of existing spot Bitcoin ETFs, as some overnight volatility stems from ETF positioning, derivatives transactions, and flow-related dynamics.
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