BlackRock is stepping further into crypto income products with a new covered-call bitcoin ETF BlackRock (BLK), the world’s largest asset manager with roughly $12.5 trillion in assets under management, filed a Form S-1 with the U.S. Securities and Exchange Commission to launch the iShares Bitcoin Premium Income ETF. The move marks a push by the firm to offer an income-oriented way to gain exposure to bitcoin (BTC $87,769.19). How the fund would work - The ETF would actively manage exposure to bitcoin either directly or by holding shares of BlackRock’s existing iShares Bitcoin Trust (IBIT). - It would generate income by selling call options on that bitcoin exposure—a “covered-call” strategy that pays option premiums to the fund in exchange for capping upside if bitcoin rises above the option strike. - Those collected premiums would be distributed to investors as income. The fund has not yet announced a ticker or fee schedule. Why this matters - Covered-call strategies are common in equity income funds and are increasingly being used in crypto. The tradeoff is straightforward: investors receive regular income but give up some upside potential if bitcoin surges. - BlackRock’s version is notable because of the firm’s scale and the link to IBIT, which is already the dominant spot bitcoin ETF with more than $69.7 billion in assets (SoSoValue data). BlackRock’s bitcoin offerings have become a major revenue driver for the firm. How it compares to existing products - Several providers already offer option-income strategies on bitcoin, including: - Roundhill Bitcoin Covered Call Strategy ETF (YBTC) - Amplify Bitcoin Max Income Covered Call ETF (BAGY) - NEOS Bitcoin High Income ETF (BTCI) - These funds can deliver high distribution rates—often relying in part on return of capital, which can reduce net asset value (NAV). Current distribution rates: YBTC ~35.87%, BTCI ~27.25%, BAGY ~37.1%. Performance trade-offs - Income-focused bitcoin ETFs typically underperform spot BTC during rallies, by design. Over the last 12 months, BTCI is down about 31.3% and YBTC down around 45%, while bitcoin’s drawdown was roughly 14% in the same period. BAGY, which launched in late April 2025, is down about 25% since debut. - High distributions and option activity can cushion volatility but may also erode NAV over time and limit upside exposure. What to watch next - Details to await include the ETF’s ticker, fee structure, exact option-management rules and the SEC’s response to the S-1 filing. Investors should weigh the appeal of regular income against the potential for reduced capital appreciation compared with holding spot bitcoin. Read more AI-generated news on: undefined/news

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