Market Movers: Profusa Declines as Leveraged and Inverse ETFs Reflect Underlying-Asset Volatility

• Profusa, Inc. (NASDAQ: PFSA) reported a wider second-quarter loss and disclosed convertible exchange agreements, a reverse stock split, and further financing needs.
• Moves in single-stock inverse ETFs were consistent with gains in Coinbase Global, Inc. (NASDAQ: COIN) and Strategy Incorporated (NASDAQ: MSTR), formerly known as MicroStrategy, during the referenced trading session.
• A decline in the ProShares UltraShort Bitcoin ETF (NYSE Arca: SBIT) was consistent with a higher Bitcoin price that day, while the GraniteShares 2x Long BABA Daily ETF (NASDAQ: BABX) reflected weakness in Alibaba Group Holding Limited (NYSE: BABA).

The market session featured sharp moves in Profusa, Inc. (NASDAQ: PFSA) (-28% during today's trading session) and several leveraged and inverse exchange-traded funds. Profusa is a digital-health company developing injectable biosensors and AI-enabled health-management platforms for real-time monitoring of body chemistry, including oxygen and glucose.

Profusa reported a second-quarter 2026 net loss of $8.8 million, compared with a $2.3 million loss in the prior-year quarter. As of June 30, 2026, the company had $719,000 in cash and $28.2 million in total liabilities. It also disclosed that holders had executed $10.7 million of Series A Convertible Exchange Agreements, with $4.57 million converted into Series A Convertible Preferred Stock.

The company completed a 1-for-4 reverse stock split effective August 18, 2026, and borrowed $650,000 for near-term working-capital needs. These balance-sheet and financing developments may have contributed to investor concerns, but the day’s stock move should not be attributed solely to the convertible exchange agreements.

The GraniteShares 2x Long BABA Daily ETF (NASDAQ: BABX)  (-15.46% during today's trading session) seeks to provide twice the daily percentage change of Alibaba’s U.S.-listed shares. A decline in BABX is therefore generally consistent with a decline in Alibaba shares on that specific day. Because the fund resets its leverage daily, its return over periods longer than one day will not necessarily equal twice Alibaba’s cumulative return.

The GraniteShares 2x Short COIN Daily ETF (NASDAQ: CONI) (-16.88% during today's trading session) seeks to provide negative two times the daily percentage change of Coinbase stock. Its decline was consistent with a gain in Coinbase Global, Inc. (NASDAQ: COIN) during the session.

Likewise, the Defiance Daily Target 2x Short MSTR ETF (NASDAQ: SMST) (-12.51%) seeks negative two times the daily performance of Strategy Incorporated (NASDAQ: MSTR). A fall in SMST was consistent with a higher MSTR share price that day. Strategy’s stock is often sensitive to Bitcoin because of the company’s large Bitcoin holdings, but it remains an equity security.

The ProShares UltraShort Bitcoin ETF (NYSE Arca: SBIT) (-12.51% during today's trading session) seeks negative two times the daily return of Bitcoin. Its decline was consistent with Bitcoin strengthening during the session. However, one day’s moves in leveraged and inverse ETFs should not be treated as evidence of a sustained trend or broad market sentiment because daily leverage, volatility, fees, and rebalancing can materially affect returns.