BlackRock-Backed ETF Swaps Record $5 Billion in Tax-Deferred Bitcoin Trades

BlackRock's iShares Bitcoin Trust (IBIT) has seen significant growth since its approval by the US Securities and Exchange Commission on July 29, 2025. The fund attracted a record $1.33 billion in cash inflows last week, marking its highest year-to-date weekly intake.

In response to rising demand for tax-deferred Bitcoin-to-ETF swaps, BlackRock reduced the minimum size for in-kind transactions from $25 million to $1 million last month. This move has led to a surge in such transactions, with IBIT facilitating $5 billion of in-kind conversions as of August 26, up from $3 billion in October 2025.

Robbie Mitchnick, head of digital assets at BlackRock, attributes the growing demand for these transactions to external factors such as security concerns. He stated that people are motivated to switch their holdings due to events like kidnappings and ransom demands.

The trend is also being driven by other Bitcoin ETFs, including Bitwise's BITB, which has reduced its minimum deal size from $100 million to $3 million. This increased accessibility has contributed to the institutionalization of Bitcoin as a mainstream asset.