BlackRock Drops Minimum Threshold for In-Kind Bitcoin Swaps to $1M

BlackRock has lowered the minimum for in-kind Bitcoin-to-IBIT ETF swaps from $25 million to $1 million, making it easier for large Bitcoin holders to transfer their coins into its spot Bitcoin ETF without selling them first.

This change reduces the barrier for entry, allowing more wealthy individuals and institutions to take advantage of the in-kind conversion route. Previously, investors needed at least $25 million in Bitcoin to use this method, which is now lowered by 96%.

Robbie Mitchnick, BlackRock's head of digital assets, discussed the change on Bloomberg's ETF IQ on August 10 and hinted that the firm could lower the threshold further over time. The move aims to make the process more accessible to a wider group of investors, including those who want exposure to Bitcoin through a regulated ETF without exiting their positions.

The in-kind conversion route allows eligible holders to transfer Bitcoin directly into the IBIT structure, rather than selling it for cash first. This can offer several potential advantages, such as reduced trading steps and potentially lower tax liabilities.