BlackRock's Bitcoin Income ETF Gets 65Bps Fee, Undercutting Rivals As Goldman Launch Looms, Says Analyst

• BlackRock set a 65-basis-point fee for its planned iShares Bitcoin Premium Income ETF on Wednesday, which will generate income by writing covered-call options on shares of its spot Bitcoin ETF.
• Bloomberg analyst Eric Balchunas said the latest SEC filing is likely the fund's final amendment and expects BITA to launch soon
• Balchunas said BlackRock is racing Goldman Sachs to market in the growing Bitcoin income ETF segment, calling it "game on" as Goldman targets a launch around July 1.

BlackRock (BLK) has set a 65 basis point fee for its planned iShares Bitcoin Premium Income ETF (BITA) and is racing to beat Goldman Sachs (GS) to market, Bloomberg analyst Eric Balchunas said on Wednesday.

According to the filing, an amended Form S-1 submitted to the US Securities and Exchange Commission (SEC) on Wednesday, BITA will trade on Nasdaq (NDAQ) and seek premium income through a covered-call strategy, writing monthly call options primarily on shares of BlackRock's spot Bitcoin ETF, IBIT, while tracking Bitcoin's (BTC) price. The document sets the sponsor's fee at 0.65% of net assets, accrued daily. 

Balchunas said that the amendment was "probably [a] final” one, and said he expects the fund to launch soon. The 65bps fee is higher than BlackRock's iShares Bitcoin Trust ETF (IBIT) but lower than the two largest Bitcoin covered-call exchange-traded funds (ETFs), which charge 95 and 99 basis points, he said.

IBIT’s price was down by 0.20% during mid-morning trade. On Stocktwits, the retail sentiment around IBIT remained in the ‘bearish’ zone, while chatter around it moved from ‘high’ to ‘extremely high’ levels over the past day. 

Balchunas placed the launch in the context of a race with Goldman Sachs. BlackRock is under pressure to beat Goldman to market, he wrote, noting that Goldman's competing Premium Income ETF is expected to be effective around July 1. "Game on," he added.

A Crowded, High-Yield Field

The fund enters a fast-growing category whose payouts vary widely. A key open question, Balchunas said, is what yield BlackRock and Goldman Sachs will target, since that determines how close to Bitcoin's current price they write their options and, in turn, how much upside they hand back to investors. GS, which filed for its Bitcoin Premium Income ETF on April 14, has not yet disclosed a fee.

Balchunas noted that yields among existing Bitcoin covered-call ETFs range from YieldMax's YBIT near 101% to NEOS Boosted Bitcoin High Income ETF (XBCI) at 10%, reflecting how aggressively each writes options and how much of Bitcoin's upside it gives up. BITA's own yield has not yet been set.

Read also: Strategy's Road To 1 Million Bitcoin Could Be Shorter Than You Think, MSTR Analyst Says

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