BlackRock Bitcoin Protection ETF Filing Selects 75-Day Effective Period

BlackRock selected a 75-day effective period in its Oct. 19 filing for a Bitcoin (BTC) fund that would cap gains in exchange for partial protection against losses.

The proposed iShares Bitcoin Managed Protection ETF, with the planned ticker PBIT, would use options tied to BlackRock’s iShares Bitcoin Trust ETF (IBIT) or similar Bitcoin exposure. It would not hold Bitcoin or Bitcoin exchange-traded products directly. Its other holdings would include cash, money market funds and short-term debt.

The strategy would normally hold three overlapping batches of options, replacing one each month. For each batch, purchased call options would typically have a strike price near 90% of the reference asset’s value when the position begins. That creates an initial loss threshold of about 10% for the batch before fees. Selling other call options would help cover costs while limiting gains.

The 10% threshold is not a loss limit for PBIT shareholders. Because the batches begin at different times, the fund has no fixed protection level or cap on gains. Investors could lose some or all of their investment.

The filing also notes that using IBIT options could increase IBIT’s assets and indirectly raise fees earned by BlackRock affiliates. PBIT’s management fee and listing exchange have not been specified. The selected provision calls for registration to take effect 75 days after Oct. 19.