TL;DR
- BlackRock filed with the SEC to launch the iShares Bitcoin Premium Income ETF, designed to generate income by selling call options tied to Bitcoin exposure.
- The strategy is expected to reference IBIT shares and, at times, indices tracking spot Bitcoin ETPs.
- If approved, the ETF would enter a fast-growing segment of covered-call Bitcoin products, competing with NEOS BTCI and other option-income funds built for yield-focused investors.
BlackRock has submitted a registration filing to the U.S. Securities and Exchange Commission for a new Bitcoin-linked product aimed at combining price exposure with recurring premium income. The proposed iShares Bitcoin Premium Income ETF would seek to track the performance of Bitcoin while using an actively managed options strategy to generate additional returns beyond spot moves.
The filing reflects how the Bitcoin ETF market is evolving after spot products gained traction in U.S. brokerage accounts. Since spot Bitcoin ETFs began trading in early 2024, issuers have increasingly explored structures that offer different risk profiles, including income strategies that can appeal to investors who prefer cash-flow features inside regulated vehicles.
iShares Bitcoin Premium Income ETF Brings A Yield Strategy To Bitcoin
The iShares Bitcoin Premium Income ETF would generate premium income by writing call options on shares of BlackRock’s iShares Bitcoin Trust (IBIT). In practice, the fund sells contracts that give buyers the right to purchase IBIT shares at a predetermined price, collecting option premiums in return.
The filing also notes the fund may, from time to time, write options tied to indices that track spot Bitcoin exchange-traded products. This design can expand flexibility while keeping the strategy connected to regulated Bitcoin ETP markets.
Because the ETF is actively managed, it is expected to charge higher fees than passive spot funds. That cost difference reflects the operational demands of managing an options book, including trade execution, risk controls, and portfolio adjustments.
Covered Call Bitcoin ETFs Expand Competition Among Issuers
BlackRock’s proposed ETF would compete with existing covered-call Bitcoin funds already trading in the U.S. The NEOS Bitcoin High Income ETF (BTCI), launched in October 2024, has reached about $1.09 billion in assets under management and charges an expense ratio close to 0.99% per year. Other competitors include the Roundhill Bitcoin Covered Call Strategy ETF (YBTC), with around $225 million AUM, and the YieldMax Bitcoin Option Income Strategy ETF (YBIT), with roughly $74 million.
Covered-call strategies can offer more consistent income potential, particularly during range-bound markets when option premiums contribute meaningfully to returns. However, they may also cap upside participation during strong rallies, making them a better fit for investors prioritizing yield over maximum price appreciation.
