BlackRock filed with the SEC to launch a Bitcoin income ETF using covered call strategies, expanding institutional crypto investment options.
BlackRock has filed a new application with U.S. regulators to expand its bitcoin investment offerings. The proposed product is aimed at investors who want to earn regular income and also get exposed to the increasing and decreasing price of bitcoin.
BlackRock Files for Bitcoin Income ETF Using Covered Call Strategy
On January 26, 2026, BlackRock filed an S-1 registration statement with the U.S. Securities and Exchange Commission. The filing is for approval to introduce the iShares Bitcoin Premium Income ETF under the iShares brand.
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According to the filing, the ETF will employ a covered call strategy in order to generate recurring income. This method is to hold the bitcoin but sell call options and collect option premiums on a regular basis.
The fund will be set up as a Delaware statutory trust. It will be holding bitcoin directly, along with shares of the iShares Bitcoin Trust ETF, known as IBIT, and cash positions.
Cash holdings will contain premiums generated by options trading activity. As a result, the ETF is intended to transform the price exposure with income generation.
Shares of the ETF will be fractional beneficial interests in assets of the fund. These assets are bitcoin, IBIT shares, and cash accounts.
BlackRock said that more information is not being made public yet. The firm has not disclosed the expense ratio, ticker symbol or launch timeline.
Such omissions are quite common in early S-1 filings to the SEC. Initial registrations tend not to include fees, custodians and trading venues.
However, the filing does confirm that Coinbase will be the custodian of the bitcoin. Meanwhile, the Bank of New York Mellon will do custody for cash holdings.
The ETF cannot start trading until it receives the formal approval from the SEC. Regulatory review timelines may differ depending upon requested amendments.
Bitcoin Income ETFs Gain Attention After IBIT Success
The filing comes as there has been strong demand for BlackRock’s spot Bitcoin ETF, IBIT. Since launch, IBIT has racked up more than $69.85 billion in assets.
Market participants see IBIT’s growth as proof of institutional demand for bitcoin. For this reason, income-oriented products are receiving a greater focus.
The proposed ETF is aimed at investors who want to get a yield from exposure to bitcoin. In return, investors forgo some upside in strong bull markets.
Covered call strategies usually provide income in sideways or moderately bullish conditions. However, returns can fall behind in drastic price rallies.
There are already several similar bitcoin income ETFs trading in the U.S. market. These products help to put BlackRock’s proposal in perspective.
One such example is NEOS Bitcoin High Income ETF. It trades with the BTCI ticker in the Cboe BZX Exchange.
BTCI was launched in October of 2024, and it has about $1.09 billion in assets. The fund has an annual expense ratio of close to 0.99%.
Compared to competitors, BlackRock has yet to show its fee structure. The firm said that it cannot comment on competitive positioning.
Additionally, a combination of IBIT exposure and options income may be attractive to conservative investors. Such investors often focus on predictable cash flows.
However, risks are still associated with bitcoin volatility in the market and options market conditions. Income levels may vary depending on market demand.
Regulatory approval is the last hurdle before launch. The SEC continues its close review of crypto-linked investment products.
Ultimately, the filing illustrates changing demand among investors beyond tracking prices. Income-focused bitcoin products continue to define the next phase of crypto finance.