BlackRock Files for Bitcoin Income ETF to Generate Yield from Options

BlackRock is also seeking approval of a new ETF that would track Bitcoin with the U.S. Securities and Exchange Commission. The company will call it the iShares Bitcoin Premium Income ETF. This product will not be holding Bitcoin. It will rather follow Bitcoin with IBIT shares. Simultaneously, it will earn profits on the sale of call options on said shares. Consequently, it leads to the fact that BlackRock now enters the income-oriented sector of crypto ETFs.

LATEST: 💰 BlackRock filed with the SEC to launch an iShares Bitcoin Premium Income ETF that will generate income by selling call options on IBIT shares, competing with NEOS's $1.09 billion BTCI fund. pic.twitter.com/uXaztkmGFX

— CoinMarketCap (@CoinMarketCap) January 27, 2026

How the Income Model Works

The new ETF will be based on a covered call strategy. It is going to sell call options of IBIT holdings. This enables the fund to receive frequent option premiums. Thus, even in the situation when Bitcoin is moving sideways, investors get income. Nonetheless, this framework does not allow much gain in times of powerful upsurge. The fund might limit profits in case of a Bitcoin explosion. Nevertheless, lots of investors would want to invest in a stable yield rather than pure volatility.

In the meantime, this action has a direct confrontation with NEOS Investments. NEOS already has the BTCI ETF. The fund has an asset of approximately 1.09 billion. It also relies on options to obtain revenues based on Bitcoin exposure. Brand power and distribution scale are now introduced by BlackRock in the same market. This increases crypto yield products competition.

Massive Growth of IBIT

More to the point, BlackRock develops the product based on the success of IBIT. IBIT continues to be the biggest spot Bitcoin ETF in the world. It has an asset management of more than 40 billion. This is an indication that there is high institutional demand of Bitcoin via regulated vehicles. BlackRock has thus transferred this demand to income strategies. It is an indication of movement of pure exposure to structured products.

Conservative investors are attracted to income based ETF. There are numerous funds interested in having exposure to Bitcoin but are afraid of volatility. This problem is resolved by covered call strategies. They reduce risk perception. They bring about repeatable returns. In classic markets, such kinds of strategies pay 5-15 percent per year. Therefore, this can give the rise to similar demand in crypto.

Blackrock Implication of Bitcoin Markets

Bitcoin is also liquid in this filing. Increased number of ETFs implies increased capital movement. The market depth is enhanced by the activity in options. Institutions acquire additional resources. Retail investors have an increased number of options. These products make crypto investing professional over the years. They transform Bitcoin into a portfolio investment rather than a speculative investment.

Lastly this development indicates a larger change. Crypto ETFs are no longer concerned with tracking the prices. They currently provide yield, risk management and portfolio design. BlackRock is the pioneer in this change. When accepted, this ETF would restructure the relationship of investors with Bitcoin in conventional finance.