BlackRock Slashes Minimum in-Kind Bitcoin Swap Threshold to $1 Million

BlackRock has reduced the minimum in-kind Bitcoin swap threshold for its iShares Bitcoin Trust (IBIT) from $25 million to $1 million, providing a direct route into the spot Bitcoin ETF without selling BTC first.

This change could make the process available to a wider group of wealthy Bitcoin holders and institutions. Authorized participants, financial institutions responsible for creating and redeeming ETF shares, can now transfer Bitcoin directly into IBIT without first converting it into cash.

The in-kind conversion route has several potential advantages, including reduced trading steps and potential tax benefits. However, investors should not assume that every in-kind transfer is automatically tax-free, as the exact treatment depends on individual circumstances.

Robbie Mitchnick, BlackRock's head of digital assets, discussed the change on Bloomberg's ETF IQ on August 10. He also indicated that the firm could lower the threshold further over time.