BlackRock is stepping up its push into crypto ETFs with plans for a bitcoin-linked income fund that relies on options trading to deliver yield.
The world’s largest asset manager, which oversees about $12.5 trillion in assets, has filed a Form S-1 with the U.S. Securities and Exchange Commission to register the iShares Bitcoin Premium Income ETF. The proposed product is designed to provide regular income while maintaining exposure to bitcoin.
Under the filing, the fund would actively manage bitcoin exposure either directly or through shares of BlackRock’s iShares Bitcoin Trust (IBIT). To generate income, the ETF would sell call options on that exposure, employing a covered-call strategy that allows it to collect option premiums in exchange for giving up some potential upside.
Covered-call approaches are common among equity income funds and have already been adopted in several crypto-focused ETFs. BlackRock’s entry, however, stands out due to the scale of its platform and the dominance of IBIT, which has amassed more than $69.7 billion in assets, according to SoSoValue. The firm’s bitcoin ETF suite has rapidly grown into a major source of revenue.
Details such as the fund’s ticker symbol and expense ratio have not yet been disclosed. The ETF would actively manage its options positions and distribute the collected premiums to investors as income, a structure that typically trades capital appreciation potential for yield.
Existing bitcoin covered-call ETFs include the Roundhill Bitcoin Covered Call Strategy ETF (YBTC), the Amplify Bitcoin Max Income Covered Call ETF (BAGY) and the NEOS Bitcoin High Income ETF (BTCI). While these funds often post eye-catching distribution rates, payouts can dilute net asset value, sometimes through returns of capital. YBTC currently shows a 35.87% distribution rate, compared with 27.25% for BTCI and 37.1% for BAGY.
In terms of performance, bitcoin income ETFs have generally lagged the underlying asset. Over the past 12 months, BTCI is down roughly 31.3% and YBTC has fallen 45%, versus about a 14% decline for bitcoin. BAGY, which launched in late April 2025, has dropped around 25% since its debut.
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