BlackRock has filed with the U.S. Securities and Exchange Commission (SEC) for a new ETF that aims to provide some protection against Bitcoin declines while also limiting upside returns.
According to The Block, the world’s largest asset manager filed for the iShares Bitcoin Managed Protect ETF on Monday, October 19. The new product aims to offer investment exposure linked to the company’s existing Bitcoin fund, IBIT, or similar Bitcoin investments.
Protection against declines, limited upside
According to the design described in the filing, the fund aims to participate in gains from IBIT or similar Bitcoin investments up to a certain cap. The other side of the structure aims to provide a degree of protection against price declines.
Here’s the key difference for investors: rather than tracking all of Bitcoin’s gains, the fund will not benefit from any increases above a set limit. In return, it will seek to limit the impact of declines.
The scope of the protection and the terms of the return cap will determine the product’s risk-return balance. This goal, set out in a filing, is not a guarantee that investors will not lose money.
BlackRock’s Bitcoin products are expanding
IBIT, which launched in January 2024, is the largest fund of its kind, with more than $65 billion in assets. In June, BlackRock also launched the iShares Bitcoin Premium Income ETF, which aims to generate monthly options premium income alongside Bitcoin exposure.
Bloomberg Intelligence analyst James Seyffart noted that the new filing is BlackRock’s third Bitcoin ETF filing. The company’s crypto products remain limited to Bitcoin and Ethereum, while other issuers have also launched ETFs tracking assets such as XRP, Solana, and Dogecoin.
The new filing shows that BlackRock is diversifying its Bitcoin investment options rather than expanding into other cryptocurrencies.
Not investment advice.