BlackRock, the world’s largest asset manager, has filed for a new Bitcoin exchange-traded fund (ETF) that offers limited downside protection in exchange for capped gains. The proposed iShares Bitcoin Managed Protection ETF (PBIT) would use options linked to BlackRock’s existing iShares Bitcoin Trust ETF (IBIT) rather than holding Bitcoin (BTC) directly.
The filing comes as BlackRock continues to expand its crypto fund lineup, which already includes the $65.7 billion IBIT and the $8 billion iShares Ethereum Trust ETF (ETHA). However, the asset manager has yet to launch spot ETFs tracking other cryptocurrencies like Solana or XRP, a decision that has raised eyebrows in the industry.
ETF Store president Nate Geraci expressed surprise at BlackRock’s absence from the market for spot ETFs tracking other cryptocurrencies, noting that the firm appears to have high conviction in only Bitcoin and Ethereum, at least for now.
The PBIT would use three overlapping sets of options contracts, typically replacing one each month, to seek downside protection while limiting potential gains. Each options tranche would initially target a maximum loss exposure of about 10% to the underlying Bitcoin-linked asset, before fees and expenses. BlackRock cautioned that the fund does not provide a fixed protection start value, floor, or cap value, implying investors could face greater losses.