Gate Research: Transparent & Low-Fee Advantage | Gate ETF Scale Effect Strengthens

Abstract

• Over the past two years, exchanges have significantly scaled back and phased out ETF offerings. As the number of platforms able to support stable ETF trading has declined, Gate’s continued provision of ETF trading has become a scarce competitive advantage.
• Gate is not merely offering ETFs, but has developed them into a mature product line with scaled supply, transparent and explainable mechanisms, and a unified, low-cost fee framework.
• Throughout 2025, Gate supported trading in 244 ETF leveraged tokens, serving approximately 200k cumulative trading users, with average daily trading volumes reaching the scale of several hundred million dollars.

I. Market Overview

In the context of crypto trading, ETFs refer to exchange-issued leveraged tokens (ETF Leveraged Tokens), which package perpetual futures positions into tokenized instruments that can be traded directly on the spot order book. This allows users to gain long or short exposure at a target leverage simply by buying or selling a single token. However, over the past two years, the supply of ETF leveraged tokens on crypto exchanges has contracted markedly. For example, B** phased in the suspension of leveraged token trading, subscriptions, and redemptions between February and April 2024 before ultimately discontinuing support altogether. B** also announced the delisting of certain leveraged tokens in 2024, halting spot trading as well as subscriptions and redemptions, and continued to remove leveraged token pairs for assets such as BTC and ETH in 2025. Toward the end of 2025, K** issued a series of announcements to delist multiple groups of leveraged tokens in batches, while carrying out phased wind-downs of services related to BTC leveraged token trading, subscriptions, and redemptions.

The delisting of ETF leveraged tokens by exchanges does not reflect a lack of demand for leverage among users. Rather, leveraged tokens are highly structured products. Without sufficient disclosure of mechanisms, robust risk controls, and adequate user education, they are prone to being misused as fixed-leverage instruments for long-term holding. In volatile or range-bound markets, this can lead to pronounced path dependence and volatility decay, triggering concentrated user complaints and product disputes. As the industry has moved toward greater compliance and lower risk tolerance, many platforms have chosen to eliminate such complex product categories. As a result, the number of major exchanges capable of providing stable ETF leveraged token trading has continued to shrink.

From another perspective, this trend also implies that for platforms such as Gate, which have continued to support and iteratively improve this category, product availability itself has become a scarce competitive advantage. With fewer comparable platforms remaining, users have fewer alternative access points, making liquidity and trading activity more likely to concentrate on Gate and enabling it to absorb a larger share of short-term leveraged trading demand.

II. Product Structure

The core design of Gate’s ETF leveraged tokens is to map leveraged positions in underlying perpetual futures into a tokenized product whose net asset value can be traded directly on the spot order book. For users, the trading experience is closer to spot trading, as no margin is required and there is no need to actively manage margin levels or liquidation thresholds as with futures contracts. In addition, costs are packaged at the product level. Gate clearly discloses that ETF leveraged tokens are subject to a unified management fee of 0.1% per day, which covers futures trading costs incurred through hedging, funding rates, and slippage.

Leveraged tokens are not intended to replace futures contracts. Rather, they reframe leverage from a professional trading instrument into a tactical tool, and are particularly suited to two typical use cases:

• Trending markets: When the market exhibits a strong directional move, leveraged tokens amplify exposure and use rebalancing mechanisms to keep leverage close to the target level.
• Leveraged participation without managing liquidation risk: Users do not need to monitor margin balances, add collateral, or manage liquidation risk as they would with futures. This does not mean the product is risk-free; rather, risk is shifted from liquidation events to net asset value path effects and rebalancing losses.

Overall, ETF leveraged tokens are better suited to short-term, strongly trending market conditions, rather than long-term holding strategies.

III. Mechanism Breakdown

The two most critical variables of leveraged tokens are rebalancing and the net asset value path. Gate provides explicit parameter disclosures for these mechanisms, which in itself is an important signal of the product maturity of its leveraged tokens.

3.1 Rebalancing Schedule and Trigger Rules

Gate’s 3x and 5x leveraged tokens follow a scheduled rebalancing process, with rebalancing occurring daily at 00:00 (UTC+8).

In addition, Gate clearly defines leverage fluctuation ranges within which rebalancing is not triggered. These ranges directly determine how frequently positions are adjusted and how much frictional cost is incurred in range-bound or volatile markets:

• 3x Long: If leverage remains between 2.25x and 4.125x, rebalancing is generally not triggered. Once leverage moves outside this range or other conditions are met, it is adjusted back to 3x.
• 3x Short: The non-rebalancing range is between 1.5x and 5.25x.
• 5x: No rebalancing occurs as long as leverage stays within the range of 3.5x to 7x.
• In addition, when the price of certain ETF tokens becomes too low to affect trading precision, Gate may carry out token consolidation or splits. This changes the number of units held and the net asset value per unit, but does not change the total value of the position.

These parameters are highly technical, but they are precisely what professional users care about most. Narrower ranges and more frequent triggers typically result in greater losses in range-bound markets, while more reasonable ranges and more transparent disclosures allow users to treat the product as a tool that is calculable and predictable in use.

3.2 Management Fees and Trading Costs

Gate consolidates all cost components into a unified management fee of 0.1% per day, which is among the lowest rates offered by major exchanges. This management fee is all-inclusive and is used to cover funding rates, trading fees incurred during derivatives hedging, and potential slippage.

For users, Gate’s clear presentation of a unified, explainable, and low-cost fee framework significantly improves cost visibility. Trading costs that would otherwise be incurred in a fragmented manner at the derivatives layer, such as funding rates, slippage, and rebalancing friction, are instead more directly reflected in changes to net asset value. This reduces attribution distortions in performance that can arise when costs are opaque or difficult to trace.

IV. Advantages of Gate ETF

As the industry has chosen to scale back complex product categories, Gate has instead continued to develop ETF leveraged tokens into a scaled, systematized, and explainable offering. Through more transparent mechanism disclosures, Gate reduces the cost of misuse and converts scarce product supply into liquidity and user stickiness.

4.1 Scale and Supply

For Gate, ETF leveraged tokens are not merely a functional add-on, but one of its core business segments.

According to Gate’s 2025 annual report:

• Gate supported trading in 244 leveraged ETF tokens and continues to expand coverage across additional assets, making it one of the exchanges with the broadest support for leveraged tokens.
• Throughout 2025, Gate ETF products served approximately 200k trading users, with average daily trading volumes reaching the scale of several hundred million dollars.
• At the product level, Gate ETF has continued to iterate and enhance functionality, successively launching features such as multidimensional data dashboards, rebalancing history displays, and beginner education modules to help users get started more quickly, while continuously improving decision-making efficiency and the overall trading experience.

While B** halted leveraged token trading and other exchanges such as B** and K** continued to delist similar products, Gate instead expanded both product breadth and trading activity, forming a clear structural advantage. Looking ahead, Gate plans to introduce new formats such as portfolio ETFs and low-leverage inverse ETFs, continuing to reduce costs through technical optimization and to extend more robust forms of leveraged exposure.

4.2 Clear Mechanism Disclosure and Explainability

Whether leveraged tokens can be sustained over the long term does not depend solely on the number of supported assets, but on whether the product itself can be clearly explained. This is the fundamental threshold for scaling such offerings. Gate provides granular disclosures covering rebalancing schedules, trigger ranges, and the scope of costs included in the management fee. By maintaining more transparent, rule-based disclosures, Gate turns highly controversial products into calculable tools. This level of explainability is one of the scarcest capabilities during periods of market retrenchment.

4.3 Shifting Complexity to the Platform While Preserving Trading Certainty for Users

Gate consolidates costs into a unified management fee of 0.1% per day and clearly specifies that it covers hedging-related expenses. In doing so, the platform assumes greater complexity in trade execution and hedging operations through professional expertise, in exchange for a lower operational burden and more consistent cost expectations for users. At a time when the industry broadly seeks to reduce the supply of complex products, this approach of retaining complexity at the platform level while delivering certainty to users represents an important value orientation for sustaining and expanding market share.

V. Conclusion

The reason leveraged tokens have shifted from broad availability to supply contraction across the industry is not that users no longer need leverage. Rather, platforms often struggle to satisfy three requirements at the same time: explainable rules, a unified cost framework, and sustainable risk management and post-incident handling. Gate’s advantage lies in systematizing these three elements during a market downturn. It reduces room for misuse through clear disclosures of rebalancing thresholds and net asset value anchoring. It adopts a unified management fee of 0.1% per day and absorbs potential cost gaps, keeping complexity on the platform side while preserving certainty for users. Combined with scaled product coverage and a mature delisting and buyback process, Gate ETF becomes not merely a feature, but a leveraged product system that can be operated sustainably over the long term.

Disclaimer
Investing in the cryptocurrency market involves high risk. Users are advised to conduct independent research and fully understand the nature of the assets and products before making any investment decisions. Gate is not responsible for any losses or damages arising from such investment decisions.