After Trump's election, bitcoin soared because many companies that hold bitcoin became 'bitcoin whales'.$MicroStrategy (MSTR.US)$It has become the most bullish 'bitcoin shadow stock'. How much do investors fancy MSTR? ETFs that leverage this stock for investment are all restricted from trading.

The ETFs that are restricted from trading include those with the code$T-Rex 2X Long MSTR Daily Target ETF (MSTU.US)$which is a double long ETF of MSTR. Bloomberg reported that last month, Tuttle Capital Management CEO Matt Tuttle received bad news as the company's MSTU reached the swap limit that the main broker was willing to offer.

In other words, just about a month after MSTU was launched, the primary broker for securities financing activities between banks and clients had to restrict this ETF's swap trading.

Some indicators show that MSTU is the most volatile ETF on Wall Street ever. Its roi is double that of the stock MSTR. This Friday, MSTU surged over 20% during trading, with a cumulative increase of over 220% in the past month. Due to the ETF’s dramatic rise, it attracted hundreds of millions of dollars in inflow over the month. By Thursday's close this week, MSTU's assets were approximately 4 billion dollars, having grown over 600% since its launch in September.

Reports indicate that in order to achieve the expected high returns, Tuttle, who manages MSTU, has been buying swap contracts through brokers, but considering MSTR's volatility, only three companies are willing to work with him, and now all three have started to reach their swap trading exposure limits. Once, Tuttle needed an exposure of 0.1 billion dollars, and these three companies could only provide a total of 20 million dollars. To fulfill the ETF's responsibilities, Tuttle had to turn to buying call options.

In response, Tuttle commented, "If this were Procter & Gamble's fund, I could get as much swap exposure as possible. But MicroStrategy is a different kind of monster." For Tuttle, now 0.1 billion dollars in exposure is no longer a significant amount; recently he sometimes needs 0.5 billion dollars.

The situation with MSTU's competitor, another ETF that doubles down on MSTR, the Defiance Daily Target 2X Long MSTR ETF (MSTX), is similar. According to Sylvia Jablonski, CEO of Defiance ETFs, the MSTX started using options shortly after its launch in August to help meet the required leverage ratio. This ETF initially offered a leverage of 1.75 times, which increased to 2 times after Tuttle launched MSTU.

The restricted swap trading of MSTU and MSTX reflects the significant rise and popularity of the MSTR stock. Recently, microstrategy has also been increasing its bitcoin holdings, demonstrating a bullish outlook on bitcoin's performance during Trump's tenure.

Wall Street Insights mentioned earlier this week that on Tuesday, November 19, MSTR's stock price surged by 11%, surpassing the combined market cap of the world's top two gold mining companies, Newmont Gold and barrick gold.

The day before MSTR's surge, microstrategy announced on Monday that it spent approximately $4.6 billion to buy 0.05178 million bitcoins, bringing its total bitcoin holdings to 0.3312 million bitcoins. Since the fourth quarter, the company's bitcoin holdings have generated a roi of 20.4%, reaching 41.8% since the beginning of the year.

This Wednesday, microstrategy also announced plans for a private placement of $1.75 billion in convertible senior notes. This also suggests that the company may make more bitcoin acquisitions.

Famous financial commentator and gold advocate Peter Schiff believes there is a positive feedback loop between MSTR's stock price and bitcoin investment; the higher the stock price, the more shares the company can sell, the more shares sold, the more bitcoins can be purchased, and the more bitcoins bought, the higher the bitcoin price rises.

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