BlackRock is seeking to offer Bitcoin investors a measure of downside protection through a new exchange-traded fund. On October 19, the asset manager filed for the iShares Bitcoin Managed Protection ETF with the US Securities and Exchange Commission. The proposed fund would trade under the ticker “PBIT.”
Protection-Focused Structure
According to the filing, PBIT would not directly own Bitcoin or shares of the iShares Bitcoin Trust ETF (IBIT). Instead, it would hold Bitcoin options and fixed-income investments. Its holdings could include cash, cash equivalents, money market funds, short-term government obligations, and short-term investment-grade fixed-income securities.
The fund would use options linked to Bitcoin reference assets to gain exposure to the cryptocurrency’s price movements while seeking downside protection and limiting potential gains. The filing states: “The Fund seeks to provide upside exposure to the iShares Bitcoin Trust ETF (IBIT) and/or similar bitcoin exposure up to an approximate limit, while seeking to provide a level of downside protection. BlackRock Fund Advisors (“BFA”) serves as investment adviser to the Fund.”
Bloomberg analyst James Seyffart noted in a post on X that investors may have to give up some potential gains in exchange for that protection.
BlackRock’s Expanding Bitcoin ETF Lineup
BlackRock’s existing IBIT holds more than $66 billion in assets, making it the largest spot Bitcoin ETF by assets, according to data compiled by SoSoValue. The firm launched IBIT in January 2024. Earlier this year, BlackRock introduced the iShares Bitcoin Premium Income ETF (BITA), which focuses on generating monthly option premium income.
Buffered Bitcoin ETFs are not new. Calamos, First Trust, and Innovator already offer similar products. Seyffart added that BlackRock’s entry could “make a big splash,” given its size and influence in the crypto investment market.
IBIT Offsets Rival Outflows
On Monday, IBIT stood out among spot Bitcoin ETFs with $665.2 million in inflows. The other 11 funds failed to attract net inflows. Fidelity’s FBTC recorded $83.6 million in outflows, while Grayscale’s GBTC shed $54.9 million. Despite those losses, the 12 funds collectively ended the day with $526.6 million in net inflows.
