BlackRock has launched the iShares Bitcoin Premium Income ETF, a new exchange-traded fund designed to give investors Bitcoin exposure while generating monthly income through a covered call strategy.
The fund, trading under the ticker BITA on Nasdaq, holds spot Bitcoin and shares of BlackRock’s iShares Bitcoin Trust ETF, known as IBIT. It then sells call options on roughly 25% to 35% of its IBIT holdings to collect option premiums that can be distributed to investors.
The launch expands BlackRock’s Bitcoin ETF lineup after IBIT became the largest spot Bitcoin ETF, with nearly $49 billion in assets. BlackRock said the new product responds to client demand for Bitcoin exposure paired with potential income generation.
BlackRock Head of Digital Assets Robert Mitchnick said a large segment of the firm’s clients remains interested in Bitcoin while also focusing on yield generation. He said BITA was built to let investors retain most of their Bitcoin upside exposure while capturing potential income through an exchange-traded structure.
A covered call strategy involves holding an asset while selling call options against part of the position. The seller receives option premium income, which can improve returns when the underlying asset trades sideways or rises moderately.
The strategy also has trade-offs. If Bitcoin rises sharply, gains may be limited on the portion of the portfolio covered by sold call options because the fund may have to deliver exposure at the option strike price. Option income can also vary based on volatility, trading activity, and market conditions.
BlackRock said IBIT’s daily options trading volume ranks among the top 1% of all options products, with about $3.7 billion in average daily trading volume. That options market provides the infrastructure needed for BITA’s income strategy.
Jay Jacobs, BlackRock’s U.S. head of equity ETFs, said the fund is meant to address a broader range of investor needs as Bitcoin products mature. He said some investors want to maintain a mostly long Bitcoin position while generating income from that exposure.
BlackRock sees several potential investor groups for BITA. One group includes income-focused investors seeking alternatives to dividends and bonds. Another includes Bitcoin holders who remain bullish but want cash flow from long-term positions.
Jacobs also said some investors have historically avoided assets such as Bitcoin or gold because they do not produce income. BITA is structured to address that concern by attaching an options-based income component to Bitcoin exposure.
The fund may attract some IBIT holders who want income, although BlackRock expects BITA to reach investors who may not currently own spot Bitcoin ETFs. Jacobs described BITA as a complement to IBIT, rather than a replacement for direct spot Bitcoin tracking.
BITA enters the market as Bitcoin trades near $67,000 and remains below earlier highs. IBIT has seen outflows during weaker Bitcoin price action, while investor attention has also shifted toward large equity listings and other asset classes.
The new fund reflects a wider trend in Bitcoin ETF products using options strategies to generate income. Unlike Ether or Solana, Bitcoin does not offer native staking rewards, which has pushed issuers toward covered call structures for yield-oriented products.
Goldman Sachs has also filed for a Bitcoin Premium Income ETF using a partial covered call strategy, with the fund expected to become effective around July 1, according to prior market commentary. Other income-focused Bitcoin ETFs, including products from Roundhill and NEOS, have already entered the market.
BITA carries a 0.65% sponsor fee, higher than IBIT’s 0.25% fee but lower than some competing Bitcoin income ETFs. BlackRock said the fund was registered under the Securities Act of 1933, giving option premium-related capital gains blended tax treatment of 60% long-term and 40% short-term.
BlackRock Head of Americas for Global Product Solutions Jessica Tan said delivering BITA requires ETF expertise, options execution, risk management, and institutional infrastructure.
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