5 Worst ETFs of H1 2025: Cannabis ETFs Lose Their Buzz

Cannabis ETFs like the Roundhill Cannabis ETF (WEED) and Ethereum-linked funds such as the Roundhill Ether Covered Call Strategy ETF (YETH) led the worst-performing exchange-traded funds of the year through June 30, 2025. 

These thematic funds have been hammered by a mix of regulatory setbacks, weak earnings and a reversal of investor enthusiasm that once fueled rapid growth.

Though these niche ETFs often promise high-growth potential, their high volatility and policy sensitivity have left investors nursing double-digit losses. Below, we unpack the reasons behind their collapse, profile the worst performers and explore whether a second-half rebound is in sight.

Why Cannabis and Ethereum ETFs Struggled in H1 2025 

Cannabis ETFs fell out of favor in 2025 due to a combination of political gridlock, falling wholesale prices and poor profitability across North American cannabis companies. Despite hopes for federal reform in the U.S., Congress failed to pass any meaningful cannabis banking or legalization legislation in the first half of the year. At the same time, oversupply and price compression in key markets like California and Canada weighed heavily on producer margins.

WEED and the most popular fund in the space, the AdvisorShares Pure U.S. Cannabis ETF (MSOS), each posted losses of over 35%, while another cannabis fund, the U.S. Alternative Harvest ETF (MJUS), shuttered early in the year.

Ethereum ETFs, particularly YETH, also suffered due to cryptocurrency price stagnation and investor concerns about regulatory uncertainty in the U.S. Ethereum underperformed Bitcoin significantly in the first half of 2025 as momentum behind ETH-based stablecoins and decentralized finance (DeFi) cooled. Meanwhile, option-income strategies tied to Ethereum struggled to generate sufficient yield amid low price volatility.

The 5 Worst-Performing ETFs of H1 2025

Here are the bottom five ETFs by year-to-date total return through June 30.

WEED: Roundhill Cannabis ETF

• 1H 2025 Performance: -38.7%
• Expense Ratio: 0.0%
• AUM: $3.6 million

MSOS: AdvisorShares Pure U.S. Cannabis ETF

• 1H 2025 Performance: -37.3%
• Expense Ratio: 0.77%
• AUM: $296.6 million

CNBS: Amplify Seymour Cannabis ETF

• 1H 2025 Performance: -35.8%
• Expense Ratio: 0.77%
• AUM: $53.2 million

YETH: Roundhill Ether Covered Call Strategy ETF

• 1H 2025 Performance: -34.8%
• Expense Ratio: 0.95%
• AUM: $32.5 million

SQY: YieldMax XYZ Option Income Strategy ETF

• 1H 2025 Performance: -33.9%
• Expense Ratio: 1.01%
• AUM: $62.2 million

Outlook for the Second Half: Continued Pain or Turnaround? 

Cannabis ETFs face a tough road ahead. Without major federal reform in the U.S. or an improvement in wholesale pricing, the fundamentals remain weak. However, any surprise legislative breakthrough, such as rescheduling cannabis or banking reform, could trigger a relief rally in the sector.

Ethereum and crypto ETFs are more tied to macro trends. If traditional financial institutions continue to warm up to Ethereum-backed stablecoins and smart contract platforms, ETH prices may recover, lifting funds like YETH and the YieldMax XYZ Option Income Strategy ETF (SQY). Additionally, the approval of Ether ETFs in Europe and institutional adoption could offer upside catalysts. Still, the regulatory climate and competition from other blockchains remain key risks.

In short, these five ETFs are speculative, volatile and sensitive to news cycles. While they may rebound sharply under the right conditions, investors should remain cautious and only allocate a small portion of their portfolios—if any—to such high-risk thematic funds.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investing in ETFs involves risks, and investors should carefully consider their investment objectives and risk tolerance before making any investment decisions.

At the time of publication, Kent Thune did not hold a position in any of the aforementioned securities.