BlackRock applies for Bitcoin income ETF: Earn option income while holding Bitcoin?

BlackRock submitted an S-1 registration statement for the iShares Bitcoin Premium Income ETF to the U.S. Securities and Exchange Commission on January 23, 2026. This innovative product not only directly holds Bitcoin to track its price performance but also seeks additional income through active management strategies. As the world’s largest asset manager, BlackRock has listed cryptocurrency and asset tokenization as a “market-driving theme” for 2026. This move demonstrates that traditional financial institutions are accelerating the integration of digital assets into mainstream investment portfolios, opening a new chapter in digital asset investing.

Product Application

BlackRock’s iShares Bitcoin Premium Income ETF officially filed its S-1 registration statement with the SEC on January 23, 2026. This marks another significant step in BlackRock’s expansion into the crypto asset space following the successful launch of its spot Bitcoin ETF. Although specific fee structures and trading symbols have not yet been announced, its core strategy is already clear.

This new product differs from traditional Bitcoin ETFs mainly in that it seeks additional income through active management strategies while holding Bitcoin. This design allows investors to gain exposure to Bitcoin’s price risk while also having the opportunity to earn stable cash flow.

Operational Mechanism

The iShares Bitcoin Premium Income ETF will employ a “spot + options” dual strategy, with the core being the use of a “covered call” strategy. The ETF will directly hold Bitcoin to track the spot price, which is its fundamental approach. Meanwhile, the fund’s investment advisor will actively sell call options, primarily based on BlackRock’s own IBIT shares, occasionally referencing other Bitcoin-related exchange-traded products indices.

By selling these call options, the fund can earn option premiums, which will serve as an additional income source for investors. Market analysis indicates that this strategy aims for an annual premium return of approximately 8% to 12%.

Comparison of BlackRock’s Two Bitcoin ETF Products

To clearly illustrate the differences between the new product and traditional spot ETFs, here is a comparison of their core features:

Income Potential

This ETF is designed to provide a yield-generating mechanism for Bitcoin investment, similar to how Ethereum or SOL funds generate income through staking. By selling call options, the fund can earn premiums regardless of whether Bitcoin’s price rises, falls, or remains flat. This strategy has been widely used in traditional financial markets to enhance yields.

BlackRock’s existing spot Bitcoin ETF—IBIT—has become the largest spot Bitcoin fund in the U.S., managing approximately $69.75 billion in assets. The new product is expected to further expand BlackRock’s influence in the digital asset space and offer investors more diversified Bitcoin investment options. Market analysis shows that covered call strategies perform best in mildly bullish or sideways markets, providing an additional income stream for investors.

Market Background

Bitcoin is currently at a critical price stage. According to Gate data, as of January 27, 2026, Bitcoin’s price is $88,641.9, with a market capitalization of $1.76 trillion, accounting for 56.49% of the entire cryptocurrency market.

From Gate data, Bitcoin’s price increased by 0.9% over 24 hours but declined by 4.85% over the past 7 days. This short-term volatility highlights the market’s demand for stable income strategies. Technical analysis suggests Bitcoin may test last April’s lows around $74,000, with downside risks in the weekly chart possibly reaching about $68,000. In this market environment, investment products that can provide additional income are particularly attractive.

Strategic Significance

BlackRock’s move is not an isolated event but part of its overall crypto asset strategy. The company has listed cryptocurrency and asset tokenization as a “market-driving theme” for 2026.

In its thematic outlook report, BlackRock specifically mentions Bitcoin, Ethereum, and stablecoins, viewing them as part of a broader market transformation force. The report emphasizes that BlackRock’s spot Bitcoin ETF (IBIT) has become the fastest-growing exchange-traded product in history. The application for a Bitcoin income ETF further demonstrates BlackRock’s strategic vision of viewing digital assets as part of a larger “transformation force” that includes artificial intelligence, geopolitical shifts, and global infrastructure.

Innovation and Integration

This “spot + options” innovative product design transforms highly volatile Bitcoin assets into investment tools with periodic income features. This shift is particularly attractive to traditional investors who want to participate in the crypto market but are concerned about its high volatility. For large institutional investors like pension funds and insurance companies seeking stable returns, the new product may offer a compliant way to include Bitcoin in their cash flow-focused portfolios. This marks a significant shift in institutional investor mindset—from “whether to invest in Bitcoin” to “how to use Bitcoin more wisely.”

According to Gate data, as of today, Bitcoin’s price fluctuates around $88,641.9, with a 24-hour trading volume of $978.54 million, and overall market sentiment remains neutral. This price level is roughly in line with the 2026 average of $88,432.3, fluctuating between a recent low of $84,010.68 and a high of $91,969.59.

As major financial giants like BlackRock become the main sellers of bullish options in the market, the entire Bitcoin volatility structure will face reshaping. The combination of Wall Street’s financial engineering and the innovative nature of cryptocurrencies is gradually revealing a unique landscape where traditional market maturity coexists with the growth potential of emerging markets.