Gate ETF Token FAQs: Products, Risks, and Trading Guide

If you are looking for a cryptocurrency trading tool that can amplify market volatility gains, is easy to operate, and avoids liquidation risks, then the Gate leveraged ETF token might be exactly what you need.

This article combines the latest information and market dynamics as of December 16, 2025, to clarify core questions and answers about Gate ETF tokens.

01 Product Basics: Understanding Gate Leveraged ETF Tokens

What are Gate Leveraged ETF Tokens?

Gate Leveraged ETF Tokens are an innovative financial derivative that brings the concept of leveraged ETFs from traditional finance into the cryptocurrency space.

The core idea is that it encapsulates complex leverage operations into a simple spot token. Users do not need to interact with contract interfaces, provide collateral, or worry about liquidation risks; they can trade these tokens like ordinary cryptocurrencies to achieve fixed leverage multiples such as 3x or 5x.

What does the name of a leveraged ETF token mean?

The naming convention is clear and straightforward, consisting of three parts: “Underlying Asset + Leverage Multiple + Direction.” For example:

• BTC3L: Represents a 3x long Bitcoin. When BTC price rises by 1%, the theoretical net asset value of this token increases by about 3%.
• BTC3S: Represents a 3x short Bitcoin. When BTC price drops by 1%, the theoretical net asset value of this token increases by about 3%.

How does it fundamentally differ from traditional contract leverage trading?

This is key to understanding the product. Traditional leveraged contract trading requires users to manage margin, calculate liquidation prices, and bear liquidation risks. In contrast, Gate leveraged ETF tokens eliminate personal liquidation risk because the underlying contract positions are professionally managed and automatically adjusted by the system.

The specific differences are shown in the table below:

02 Operation Mechanism: How the Product Achieves and Maintains Leverage

How do leveraged ETF tokens operate?

Their stable operation relies on a mechanism managed by a professional team. Each leveraged ETF token has a corresponding perpetual contract position as support to ensure its leverage multiple.

The key component is the “daily automatic rebalancing” mechanism. The system automatically adjusts the size of the underlying contract position daily based on market fluctuations to keep the leverage within the target range (e.g., 3x). This means that during profit periods, the system automatically increases the position size to amplify gains; during losses, it reduces the position to control risk. Users do not need to manually intervene.

Why is a management fee required?

The platform charges a daily management fee of 0.1% of the token’s net asset value. This fee covers the costs of maintaining the leverage structure, including opening and closing contract positions, funding rates, slippage, and rebalancing expenses. Among similar products, this fee rate is considered relatively low.

03 Trading Operations: How to Start Your First Trade

How to trade leveraged ETF tokens on the Gate platform?

The trading process is identical to spot trading, very straightforward:

1. Visit the trading page: Log in to the Gate official website or app, find “Trading” in the top navigation, then select the “Leverage ETF” section.
2. Find the target token: Enter the token name (e.g., BTC3L) in the search box or browse the available product list.
3. Execute buy or sell: In the trading interface, input price and quantity, then click “Buy” or “Sell.”
4. Manage your holdings: After the transaction, view your position in the “Assets” page; unfilled orders can be managed in “Current Orders.”

What should you pay attention to during trading?

Most importantly, understand that you are trading the fund’s net asset value, not directly holding the underlying cryptocurrency. Your profit or loss depends on the changes in the token’s net value, which is determined by the system-managed contract position performance.

04 Risks and Costs: Important Precautions Before Using

Are leveraged ETF tokens truly risk-free?

No. They eliminate liquidation risk but do not remove the inherent market risks of leveraged trading.

Main risks include:

• Magnified volatility: Whether gains or losses, they are reflected at the leverage multiple. Slight fluctuations in the underlying asset can cause significant changes in position value.
• Wear and tear in choppy markets: When the market lacks clear trends and oscillates repeatedly, the daily rebalancing can cause frequent position adjustments that gradually deplete principal, leading to “net value erosion.” Therefore, this product is not suitable for long-term holding.
• Cost impact: The daily 0.1% management fee accumulates over time, affecting overall net returns.

When is it most suitable to use leveraged ETF tokens?

It is best suited for capturing short-term clear trending markets. For example, when technical analysis indicates an imminent strong upward or downward trend, using the corresponding leveraged token can efficiently amplify trend gains.

For beginners, it is recommended to strictly control position size, not exceed 5% of total funds per trade, and set clear stop-loss points.

05 Market and Strategy: Thoughts in the Current Environment

How to view the current market rationally?

As of mid-December 2025, the structure of the crypto market is accelerating its transformation. Simple-to-use leveraged products are increasingly favored by traders. As one of the major global exchanges, Gate’s monthly spot trading volume has surpassed 160 billion USD, supporting liquidity for these products.

Meanwhile, the platform ecosystem remains active. For example, on December 16, Gate launched a new round of contract points airdrops, reflecting the platform’s efforts to enhance user engagement through diverse activities.

For traders, the primary task before using any leverage tools (including ETF tokens) is to assess market trends and personal risk tolerance. In sideways, non-trending markets, leverage products should be avoided or used with extreme caution.

Future Outlook

A cautious day trader chose not to trade high-risk contracts but bought ETH3L. That day, Ethereum surged by 5%. By the close, he easily gained nearly 15% return, all without checking the margin ratio once or being disturbed by liquidation warnings.

The automatic rebalancing mechanism of leveraged ETF tokens functions like a precise engine, continuously applying power on the trend’s throttle while actively braking near the risk cliff, enabling ordinary traders to drive this “amplified volatility” racing car.