BlackRock's New ETF Turns Bitcoin into a Yield-Producing Asset for Investors

BlackRock, which oversees $12.5 trillion in assets as the globe’s largest asset manager, has submitted an application for a new

Premium Income ETF. This fund aims to provide returns by using a covered call strategy on Bitcoin futures title1 [ 1 ]. Registered as a Delaware trust, the new ETF marks a strategic step beyond BlackRock’s flagship iShares Bitcoin Trust (IBIT), which has seen $60.7 billion in inflows since its debut in January 2024 title2 [ 2 ]. This initiative highlights BlackRock’s broader efforts to generate revenue from Bitcoin assets, taking advantage of regulatory changes that have shortened the approval process for crypto ETFs from 240 days to as few as 75 title3 [ 3 ].

This ETF utilizes a covered call method, selling options on Bitcoin futures to earn premiums and provide consistent income to investors title4 [ 4 ]. Unlike traditional Bitcoin ETFs that simply follow price fluctuations, this product is designed to focus on income generation, addressing Bitcoin’s typical lack of yield. Bloomberg ETF analyst Eric Balchunas likened this strategy to a “sequel” to

, emphasizing BlackRock’s concentration on Bitcoin and while largely ignoring other cryptocurrencies title5 [ 5 ]. However, this approach does limit potential profits if Bitcoin’s price surges, as some upside is given to option buyers.

BlackRock’s expanding influence in digital assets is evident in its $101 billion in crypto custody, which includes 756,000

(valued at $85.29 billion) and 3.8 million ETH (worth $16 billion). In 2025, BlackRock’s crypto ETFs brought in $260 million in annual revenue, with $218 million from Bitcoin-related products and $42 million from Ethereum title6 [ 6 ]. The new Premium Income ETF is intended to further strengthen BlackRock’s position, giving institutional clients a way to combine crypto exposure with income opportunities. Recent regulatory updates, such as the SEC’s adoption of broad listing rules for commodity-based ETFs, have sped up the approval process and could pave the way for similar funds focused on altcoins like and XRP title7 [ 7 ].

This filing is in line with a wider trend of traditional financial institutions seeking to add Bitcoin to portfolios that focus on yield. BlackRock’s IBIT currently holds over 768,285 BTC, making it the largest spot Bitcoin ETF in the United States. The new ETF could appeal to investors who previously avoided Bitcoin due to its lack of yield, especially as competitors like Fidelity’s FBTC have $12.3 billion in assets title8 [ 8 ]. Experts suggest this strategy could broaden the crypto ETF market, which has mainly featured price-tracking funds, by offering risk-return profiles suited to those seeking income.

The competitive landscape is shifting. By concentrating on Bitcoin and Ethereum,

has left room for other providers to pursue ETFs based on alternative coins, sparking a “wide open” competition for regulatory approval title9 [ 9 ]. The SEC’s faster review process, which favors cryptocurrencies with at least six months of futures trading on platforms like Coinbase Derivatives, could soon allow ETFs for , , and others title10 [ 10 ]. This evolution highlights the growing sophistication of crypto investment products, as institutions increasingly adopt advanced strategies to balance returns and income.