BlackRock’s income-focused Bitcoin ETF is nearing listing. The latest revised filing shows that the fund will generate income by selling covered call options and distribute earnings to investors, but its returns will be partially capped if Bitcoin experiences significant upward movement.
The fee is set at 0.65%.
Bloomberg ETF analyst Eric Balchunas said BlackRock has submitted a new, possibly final amended filing for the Bitcoin Premium Income ETF, ticker BITA, with a fee of 65 basis points, or 0.65%.
This level is higher than existing spot Bitcoin ETFs such as BlackRock’s IBIT, but lower than the 0.95% and 0.99% fees of the two main covered call ETFs currently available. Balchunas expects the fund to launch soon.
Sell call options on 25% to 35% of assets
According to the document, the fund plans to sell call options on approximately 25% to 35% of its assets at any given time. This structure aims to generate relatively stable option income in exchange for exposure to market volatility.
However, this strategy involves clear trade-offs. If Bitcoin rises rapidly, the fund’s upside potential is partially capped due to the sold call options. Investors gain more stable cash flow at the cost of forgoing some of the returns during sharp upward movements.
Or compete with Goldman Sachs for the first-mover advantage
Balchunas also noted that BlackRock is under pressure to launch quickly, as Goldman Sachs' own Bitcoin fund is expected to launch around July 1. If BlackRock moves first, it could gain an early foothold in this niche market.
The document also shows that the fund has completed its seed funding and has begun purchasing Bitcoin and IBIT shares, which typically indicates that the product is nearing its official launch.
Currently, capital inflows into the U.S. spot Bitcoin ETF market are increasingly concentrated in BlackRock’s IBIT and Fidelity’s FBTC. If BITA launches successfully, the structure of Bitcoin ETFs will expand beyond simple spot exposure to include income-generating investment options.