BlackRock’s $PBIT Puts a Cushion on Bitcoin ETFs—Without Locking the Gains

BlackRock filed Monday for the proposed iShares Bitcoin Managed Protection ETF (PBIT), a product designed to offer limited downside protection while capping potential gains. The preliminary prospectus was submitted to the US Securities and Exchange Commission (SEC).

PBIT would use options linked to BlackRock’s iShares Bitcoin Trust ETF (IBIT), rather than holding Bitcoin (BTC) directly, and could also hold fixed-income investments. The fund would operate three overlapping options tranches with staggered monthly start dates, generally targeting protection beginning at about 90% of the reference asset’s value, or a maximum initial loss exposure of about 10% before fees and expenses. The gain cap would depend on market conditions when each tranche begins.

The filing states that PBIT “seeks to provide upside exposure to the iShares Bitcoin Trust ETF (IBIT) and/or similar bitcoin exposure up to an approximate limit, while seeking to provide a level of downside protection.” It also warns that the fund “does not provide a fixed Tranche Protection Start Value, Floor or Tranche Cap Value,” so investors could lose more than the targeted amount. The management fee has not yet been filled in.

IBIT, which holds Bitcoin directly, had $65.7 billion in net assets as of Monday. BlackRock also operates the iShares Ethereum Trust ETF (ETHA), a spot Ether fund with $8 billion in net assets, alongside the iShares Staked Ethereum Trust ETF (ETHB) and the iShares Bitcoin Premium Income ETF (BITA).

US spot Bitcoin ETFs recorded $665 million in inflows Monday, according to SoSoValue, bringing cumulative net inflows since January 2024 to $57.4 billion and total net assets to $105.46 billion. The funds had lost about $615 million in October through Friday after shedding $228.6 million the previous week and $681.1 million the week before that.

In a separate regulatory filing published Monday, Nasdaq-listed Strive said it purchased 4,045 BTC between October 12 and 16 at an average price of about $82,803 per coin, valuing the holdings at about $335 million.