BlackRock is moving to shield bitcoin investors from losses by developing a new structured ETF, following Calamos Investments’ launch of protected funds that weather major market drawdowns. The asset manager’s filing details a strategy similar to earlier offerings designed to limit downside exposure while capping upside gains.
BlackRock Structured Bitcoin Strategy Details
- BlackRock filed plans for a protected bitcoin ETF in New York City, following early 2025 offerings by competitor Calamos Investments.
- Calamos structures its funds by allocating approximately 90% of assets into U.S. Treasuries and the remainder into bitcoin-linked options.
- The exact downside buffer and upside participation rate for BlackRock’s proposed vehicle remain unspecified in the initial filing.
Expanding Beyond Traditional Spot Funds
Based in New York City, BlackRock is expanding its digital asset lineup beyond products that merely track the underlying cryptocurrency’s spot price. In June, the firm introduced the Bitcoin Premium Income Fund (BITA), which holds bitcoin and shares of the iShares Bitcoin Trust (NASDAQ: IBIT) while selling call options on 25% to 35% of its portfolio to generate monthly income.
“There are investors across the spectrum … looking to generate some amount of income off of still having a mostly large, mostly long position to bitcoin,” Jay Jacobs, BlackRock’s U.S. head of equity ETFs, told CoinDesk at the time of the BITA launch.
Precedent Set by Calamos Protected Funds
The strategy mirrors existing products in the marketplace. Calamos debuted its first three protected bitcoin ETFs in early 2025, giving investors choices between full downside protection and options that limit losses to 10% or 20% over a defined period.
That approach has gained traction among cautious market participants. Matt Kaufman, head of ETFs at Calamos, stated in May that the firm’s protected bitcoin funds had attracted between $10 million and $15 million over several weeks, drawing capital even during periods when standard spot bitcoin ETFs experienced net outflows.
| Fund Provider | Product Type | Asset Allocation Strategy | Market Response |
|---|---|---|---|
| Calamos Investments | Protected Bitcoin ETFs | ~90% U.S. Treasuries, ~10% Bitcoin-linked options | Attracted $10 million to $15 million over several weeks amid spot ETF outflows |
| BlackRock | Bitcoin Premium Income Fund (BITA) | Holds Bitcoin and IBIT shares; sells call options on 25% to 35% of portfolio | Launched in June to generate monthly income for long positions |
BlackRock’s latest filing does not specify how much downside protection the proposed fund will offer, nor does it quantify the exact cap on bitcoin’s upside returns for participating investors.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
JUST IN: BlackRock files for a downside-protected Bitcoin ETFThe proposed iShares fund would limit upside exposure to $BTC through IBIT while offering downside protection. pic.twitter.com/bE70qLYSh7
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