TL;DR
- BlackRock lowered the minimum amount to convert Bitcoin into shares of its IBIT ETF from $25 million to $1 million starting in July.
- BlackRock’s IBIT fund has already processed more than $5 billion in in-kind conversions, up from the $3 billion reported last October.
- Asset managers such as Bitwise, Morgan Stanley, Grayscale and VanEck also operate with similar conversions.
BlackRock lowered in July the minimum size required for its investors to convert their Bitcoin holdings into shares of its spot ETF IBIT, dropping from $25 million to $1 million. This change accompanied a broader industry trend: Wall Street is building infrastructure to absorb crypto wealth through regulated, more accessible and increasingly standardized mechanisms.
The process is based on so-called in-kind creations, enabled by U.S. regulators last summer. Instead of first selling Bitcoin for dollars, the investor transfers it directly to BlackRock’s fund and receives ETF shares in return. Depending on the holder’s circumstances, this can avoid the immediate generation of a capital gains tax liability. Additionally, the investor gives up private custody, digital keys and exposure to hacks or physical theft.
BlackRock has cut minimum for private in-kind creations on iShares Bitcoin ETF to $1mil…
Has now facilitated *$5+bil* in transactions from private wallets.
In other words, bitcoin holders moving from self-custody to IBIT.
“People see things happen in the outside world -… pic.twitter.com/RuDRj6hEjR
— Nate Geraci (@NateGeraci) August 26, 2026
“People see things happening in the outside world, whether kidnappings, ransoms or custody failures, that motivate them to make this change with all or part of their holdings,” stated Robbie Mitchnick, BlackRock’s head of digital assets. According to Mitchnick, the IBIT fund has already processed more than $5 billion in this type of conversion and the process can take more than a week. Inquiries come from both U.S. and international clients.
More Asset Managers Adopt the Mechanism at BlackRock and Across the Sector
Adoption is spreading throughout the industry. At Bitwise, the minimum threshold fell from $100 million at launch to a current $3 million. Matt Hougan, Bitwise’s chief investment officer, described the evolution of the process as a shift from something artisanal toward an assembly line, with prospects of becoming even simpler.
At Morgan Stanley, in-kind conversions account for between 5% and 7% of total holdings in its MSBT ETF, valued at approximately $560 million. Grayscale, for its part, reported that in June 62% of gross Bitcoin creations and 63% of Ethereum creations were processed under this method, compared to 28% and 57% recorded in March. This mechanism is also advancing into assets such as ETH and SOL, with managers like VanEck and Bitwise operating conversions for those products.
The main restriction that persists is infrastructure: operations must go through authorized participants willing to handle crypto assets, which keeps costs elevated. However, as more intermediaries develop that capability, minimums could continue to fall.
