BlackRock Files iShares Bitcoin Managed Protection ETF PBIT With Downside Protection

BlackRock files PBIT

BlackRock filed with the U.S. Securities and Exchange Commission for the iShares Bitcoin Managed Protection ETF, ticker PBIT, aiming to pair upside exposure with “downside protection.”

BlackRock’s proposed iShares Bitcoin Managed Protection ETF would use options linked to the iShares Bitcoin Trust ETF, IBIT, rather than buying Bitcoin directly, and it would also hold fixed-income investments to generate interest income.

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BlackRock’s filing describes a typical investment segment, or tranche, that would initially carry approximately 10% downside exposure before the intended protection took effect, while also capping gains through call options.

The proposal would list on the Nasdaq stock exchange under the ticker “PBIT,” extending BlackRock’s Bitcoin ETF lineup that already includes IBIT and the iShares Bitcoin Premium Income ETF, BITA.

+2Ticker is PBIT8 of 12 outlets reported it · not in bloomingbit and 3 more▾

Analyst James Seyffart said on X that the filing marks BlackRock’s third Bitcoin ETF filing, adding, “Still only have Bitcoin and Ethereum products — no other cryptos.”

Reporting for this sectionBenzingaCointelegraph

How the buffer works

BlackRock’s proposed PBIT would pursue upside exposure to IBIT up to an “approximate limit,” while also pursuing a stated level of downside protection for investors. BlackRock’s structure would buy and sell call options on IBIT and hold fixed-income investments to generate interest income and help cushion losses, with the fund expecting to hold three overlapping groups of Bitcoin-linked options. BlackRock’s prospectus describes a “protection start value” where purchased options have an exercise price approximately 10% below the starting value of the reference asset, establishing an initial loss exposure of approximately 10% before fees and other expenses.

BlackRock’s filing also warns that the strategy does not guarantee a fixed level of protection, and it states that the fund “does not provide a fixed Tranche Protection Start Value, Floor or Tranche Cap Value.” CriptoNoticias reported that BlackRock’s prospectus says protection is “not immutable or guaranteed under any circumstances,” and it adds that corporate management fees not yet published in the white draft would reduce final gains and widen losses.

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Reporting for this sectionCrypto NewsCriptoNoticias

ETF flows and what’s at stake

CoinDesk said U.S. spot bitcoin exchange-traded funds attracted $526.6 million on Monday, the largest daily net inflow in nearly a month, driven entirely by BlackRock’s iShares Bitcoin Trust, IBIT.

SoSoValue data cited by CoinDesk showed IBIT pulled in $665.2 million, its biggest daily inflow since Oct. 7 last year, while Fidelity’s FBTC lost $83.6 million and Grayscale’s GBTC shed $54.9 million.

CryptoSlate said the rebound widened the gap with Ethereum ETFs, whose assets fell from $17.79 billion to $14.7 billion amid sustained investor redemptions, while U.S. spot Ethereum ETFs lost another $103.3 million on Oct. 19.

CoinDesk said the inflow more than erased last week’s $228.5 million of withdrawals, though the funds remain about $90.5 million in the red for October, according to CoinDesk calculations using SoSoValue’s figures.

For investors watching the new product’s terms, Bloomberg Intelligence analyst James Seyffart said the filing is a “buffer” Bitcoin ETF, and the structure would require investors to forgo some reward for protection while gains could be capped.

Reporting for this sectionCoinDeskCoinGape