The new ETF offers mid-to-high-teens yield by selling call options on Bitcoin holdings, limiting upside potential.
BlackRock introduced the iShares Bitcoin Premium Income ETF (BITA), trading on Nasdaq, which caps Bitcoin gains to deliver double-digit yields. The fund achieves this by selling call options on up to 35% of its portfolio, generating monthly distributions for investors.
The ETF splits holdings between direct Bitcoin and BlackRock’s $48.6 billion IBIT fund to track the cryptocurrency’s price. Under current conditions, it retains about 70% of IBIT’s upside while targeting a mid-to-high-teens yield, according to BlackRock’s digital assets head.
This follows Goldman Sachs’ April filing for a similar yield-focused Bitcoin product, signaling growing institutional interest in income-generating crypto strategies.