GraniteShares, an asset management company with AUM exceeding $10 billion, has submitted a new leveraged ETF application to track the stock prices of cryptocurrency-related companies such as Riot Platforms, Marathon Digital, MicroStrategy, and Robinhood.

These funds will both long and short, with the 2x long ETF generating twice the daily return of the corresponding stock. For example, when Riot Platform's stock rises by 1%, GraniteShares 2x Long RIOT ETF will rise by 2%.

This year, as cryptocurrency and stock markets reach historic highs, these leveraged ETFs have become very popular. Among them, the T-Rex 2x Long MSTR Daily Target Fund (stock code MSTU) has attracted over $1.8 billion in management assets. Similarly, the Defiance Daily Target 2X Long MSTR ETF (stock code MSTX) has accumulated $1.8 billion in assets.

These funds have outperformed MicroStrategy over the past three months, during which time MicroStrategy's stock price has risen by 150%, while MSTU and MSTX have risen by 308% and 253%, respectively.

However, the risk is that they typically perform worse than the underlying stock in bear markets. MicroStrategy's stock has fallen by 24% in the past 30 days, while MSTU and MSTX have fallen by over 50% in the same period.