It buys CME Futures... and these settle on day of expiry to the price of bitcoin. So its price WILL move with bitcoin.
https://www.cmegroup.com/markets/cryptocurrencies/bitcoin/bitcoin.quotes.htmlOnly issue is that every month it has to sell the current month and buy the following month - and these are currently about 1% more expensive than spot!
So the ETF will return same as bitcoin less 12-15% per year. So I agree not great - when you can just download some free software and buy the real thing for 0.1% commission!
Remember that for every buyer of a future on CME there is a seller. And those sellers are going to be exposed to the inverse of the bitcoin price. Generally they will hedge this by buying real bitcoins.
So effectively every $1 invested in the ETF means someone else buys $0.98 of bitcoin.